Online holiday spending up, up and away
Early reports from companies that monitor online spending show that this year's holiday buying binge is shattering existing records.
According to research published this week by companies that monitor online spending, both retail spending and online payment transactions have been well above prior years' totals. In the e-tail sector, spending continued to gain momentum as the holidays drew closer.
Research firm ComScore Networks said that online retail sales, excluding travel and auction purchases, reached $2.1 billion last week, a 28 percent increase over the same period last year. ComScore expects the week ending Dec. 14 to be the most profitable seven-day period ever recorded by e-tailers.
The research firm said online retail sales for the first week of December were just more than $2 billion, a 26 percent gain over the same week in 2002, pushing returns for the first half of December past $4 billion. For both weeks it was the first time the $2 billion mark was crested during a seven-day period since ComScore began tracking online sales in 2001.
Overall, ComScore has charted $9.4 billion in e-tail sales since the beginning of the holiday season on Nov. 1, a 29 percent increase over 2002 returns for the same timeframe. Sales since Thanksgiving have reached $4.8 billion, an increase of 26 percent over last year. The company is projecting total holiday online retail sales of roughly $12.3 billion, or a 27 percent gain over 2002 returns.
ComScore analysts observed that consumers have been waiting for e-tailers to drop prices as the holidays grow nearer, driving the sales growth. According to a survey conducted by the research firm from Dec. 5 to Dec. 8, some 56 percent of respondents said they felt retail prices would continue to drop before the end of the holiday season.
"Savvy consumers are more attuned than ever to the retail world," Dan Hess, senior vice president at ComScore, said in a statement. "The Web has become an instrument that enables holiday shopping with unprecedented precision, whether as the ultimate point of purchase or a research resource to save time and money in offline stores."
The research firm cited a number of catalysts spurring the growth of online shopping, including a larger number of people accessing the Internet, a rising number of broadband connections, more experience among Web shoppers, and improved performance on the part of many e-tailers.
The total number of payment transactions completed online also continued to increase over the opening weeks of the holiday buying season, according to VeriSign, a security software maker and domain registry services provider. According to research compiled by the company via e-tailers, transactions thus far have risen an estimated 39 percent over 2002.
VeriSign reported that its payment services group processed more than 23.6 million Internet merchant transactions, totaling approximately $3.5 billion in online sales between Nov. 1 and Dec. 16. Over the same period last year, VeriSign recorded 16.9 million transactions totaling approximately $2.9 billion in sales.
The company said that the amount of money consumers spend per transaction also has been on the upswing, rising to an average of $142 per purchase in 2003, a 16 percent gain over 2002.
This year's holiday buying season is expected to be the most lucrative ever recorded by e-tailers. A report released by Jupiter Research in November predicted that online holiday sales would reach $17 billion, a 21 percent jump over the same period in 2002. The research firm said nearly 40 percent of Internet users intend to do some or all of their holiday shopping online, an increase of 18 percent from last year.