Forrester Research reported today that U.S. online retail sales will more than double over the next six years, reaching $316 billion by 2010. The research firm projects e-commerce growth to account
for 12 percent of total retail sales in 2010, up from nearly 7 percent this year.
Yes, more people are browsing, researching, and buying stuff online, which is good news for retailers. "While
consumers continue to become more comfortable buying a variety of items online, retailers will apply what they have learned in the early days of online retailing to implement site enhancements that
provide a greater return on investment and a better experience for customers," said Carrie Johnson, senior analyst of Forrester, in a statement.
A few key findings from the Forrester report:
Most online retail categories will grow between 10 percent and 20 percent compound annual growth rate over the next six years. Categories including tools and hardware and garden supplies
will see above-average growth, as consumers become increasingly comfortable buying products that historically have seen slow growth online. Flowers will also experience an above-average spike as
consumers continue to shift spending away from telephone orders. As more retailers increase and improve their multi-channel efforts, such as in-store pickup, categories like home decor will
see an increase in sales. While the number of new households that begin shopping online will slow significantly between 2004 and 2007, momentum will build again between 2007 and 2009 when
half of U.S. households will have broadband at home. (The broadband projection seems off or too conservative. Nielsen//NetRatings recently reported that more than 50 percent of the U.S. Web-surfing
population accessed the Web via broadband connections in July). As the growth of online shoppers slows over the next two to three years, retailers will invest in one-to-one marketing efforts
to help find new customers. Retailers will target blogs, chat rooms, and message boards, and run targeted ads while consumers are discussing a specific product, or content related to that product.
