Holiday E-Shopping Gets Late Start

by Gavin O'Malley, Dec 20, 2005, 6:00 AM

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Online shoppers spent $18.6 billion, excluding travel, from Oct. 29 through Dec. 9--up 16 percent from last year, according to a Holiday eSpending report released Monday by Goldman Sachs, Nielsen//NetRatings, and Harris Interactive. But those numbers still have room to grow; around 19 percent of approximately 1,000 adult shoppers surveyed online indicated that they have yet to even begin their holiday shopping.

Research company comScore Networks, which also tracks online revenues, estimated that online spending this holiday season has increased about 23 percent from last year, but comScore's total revenue projections are lower than that of Nielsen//NetRatings. On Sunday, comScore reported that consumers spent $15.86 billion shopping online between Nov. 1 and Dec. 16.

Nielsen//NetRatings found that for the six weeks ending Dec. 9, online shoppers spent the bulk of their budgets on apparel and clothing, totaling $3.4 billion or 17 percent of total revenue online. The consumer electronics and computer hardware/peripherals categories placed second and third, with revenue totals of $2.8 billion and $2.7 billion, respectively. Books and toys/video games rounded out the top five product categories, accounting for a respective $2.2 billion and $1.4 billion in online revenue.

Heather Dougherty, senior analyst at Nielsen//NetRatings, said in the report that brand recognition of both products and online retailers played a significant role in sales. "The combination of well-known brands and retailers in the top categories strongly complement and drive online sales, because consumers trust and have confidence in both," Dougherty said in the report.

During the sixth week of the 2005 holiday retail season, the eSpending Report asked more than 1,000 consumers to break down their 2005 holiday budget among various sales channels.

Asked to break down their holiday spending, consumers said they spent the majority--69 percent--of their budgets at traditional brick-and-mortar stores. Respondents said they spent 27.5 of their allotted cash online, while designating 3.5 percent to catalogs.

Notably, consumers appear to have had a late start to this year's online shopping. As of the fifth week of the 2005 holiday season, 30 percent of consumers had not started their online shopping, which was up from 23 percent during the same time period last year. By the sixth week, 19 percent of consumers still had not started their online holiday shopping, while 37 percent of online shoppers indicated that they had finished. Forty-four percent of consumers stated that they have begun, but had not finished their holiday shopping.

To date, the majority of holiday shoppers are satisfied with their overall 2005 shopping experience, with 70 percent noting that they have felt very or somewhat satisfied. Only 5 percent of consumers cited that they were either very dissatisfied or somewhat dissatisfied.

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