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Holiday lessons on e-commerce

With the holiday shopping season past, it's time to figure out what Christmas cybershopping means for the future of consumer e-commerce.

2 min read
With the holiday shopping season past, it's time to figure out what Christmas cybershopping means for the future of consumer e-commerce.

Although it's of interest whether online consumers spent $1 billion for Christmas, the more critical issue is whether holiday shopping online will translate into continued sales.

Yes, it seems, Christmas could jump start consumer e-commerce. Some other conclusions, drawn from several analysts and consumer surveys: Not all e-commerce results in online sales. Women, who control the purse strings in most U.S. households, are being overlooked online. Apparel is emerging as a category. Security concerns persist.

The good news: Plenty of new people tried shopping online, and most liked it.

"Generally speaking, people had a very positive experience," said Lisa Gerould of PointCast, which surveyed a random set of its users right after the holiday, getting 629 responses: 80 percent very satisfied, 19 percent just or somewhat satisfied, and 1 percent dissatisfied or neutral.

PointCast users are just the kind of upscale, time-pressed consumers that retailers lust after--Gerould calls them "a bellwether segment"--and 90 percent plan more online purchases this year.

"Gift-giving might have prompted them to go online in the first place, but they bought something for themselves too," said Gerould. Convenience was the biggest driver (66 percent), while avoiding crowds (44 percent), prices (42 percent), finding items not available locally (39 percent), selection (26 percent), and speed of delivery (19 percent) were also cited. A new study by Ernst & Young with the National Retail Federation found similar motivations.

"It was so much easier than shopping or mail order," wrote one PointCast user who spent about $300 online on specialty food items for family gifts. PointCast asked for feedback on online shopping and got 15,000 emailed responses. Then it did the random email survey.

Nor were PointCast's shoppers chintzy. A third spent under $100, 28 percent spent $100 to $300, 25 percent spent $500 or more, and 13 percent spent more than $1,000, generally on a computer.

Critically, PointCast found a third of holiday shoppers were first-time buyers--an important statistic, noted Jupiter Communications e-commerce analyst Nicole Vanderbilt, because sites like bookseller Amazon.com report 40 percent of sales are to repeat customers.

"The holidays really fueled activity in certain categories. We think that can be sustained into 1998," said Gerould of the lasting legacy of holiday shopping sprees.

But the Ernst & Young study released last week points out that counting dollars spent on the Net underestimates the medium's power.

Many buyers use the Internet to research purchases, then buy at real-world retail. E&Y's study found that 32 percent of the 650 consumers with online access who were interviewed have purchased on the Net, but 64 percent use the Net to research products before purchases.