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Christmas Gift Guide
Tech Industry

Net shoppers curtail online holiday spending

Internet shoppers will spend less than 10 percent of their holiday budgets online, a new study asserts, bucking the hype about this year's sales.

Internet shoppers will spend less than 10 percent of their holiday budgets online, a new study asserted, bucking the hype about this year's sales.

The majority of online shoppers--20 million in the United States--will avoid buying most of their gifts through the Internet, citing poor customer service, unreliable shipping practices and unstable Web sites as the primary reasons, according to new research from New York-based Jupiter Communications. When consumers do shop online, however, they will stick with retailers they know, the report found.

For more than a year, analysts have forecast huge increases in earnings and the numbers of online shoppers this holiday season. Jupiter, for instance, expects e-commerce to earn $6 billion during the holidays, almost double last year's figure.

But despite the growth in e-commerce, consumers still are more comfortable doing business in a brick-and-mortar world, the report said.

"We need do put [this year's online holiday spending] into perspective," Jupiter analyst Fiona Swerdlow said in a statement. "It is still a very small percentage of what they expect to spend over the holiday season."

Trust--a key factor to shopping on the Net--continues to play a big part in where online shoppers choose to do business. The survey, of 1,300 Web shoppers just before Thanksgiving, found that 51 percent of the respondents listed site recognition and trust as important factors in choosing which stores to patronize.

"A lot rides on successful completion of their holiday shopping missions and consumers are proving pretty risk-averse," Swerdlow said.

Some 39 percent said they would buy from the Web sites of brick-and-mortar stores and 37 percent indicated that they would buy from Internet stores they had shopped before.

"The holiday battle is the established merchants' to lose," Jupiter analyst Ken Cassar said.

In the report, Jupiter warned retailers not to draw new customers exclusively by cutting prices. This holiday season online shoppers will expect good customer service, dependability and "security rather than discounts," the report said.