• by Jack Loechner , Staff Writer @mp_research, January 11, 2005

It's A Holiday Wrap

The beginning of the year Research Briefs wouldn't be complete without a look at the end of the year! The January 4th holiday eSpending Report from Goldman, Sachs & Co., Harris Interactive, and Nielsen//NetRatings revealed that online shoppers in the U.S. spent $23.2 billion during the 2004 holiday season, excluding travel. This reflects a 25 percent increase from the $18.5 billion spent online during the same timeframe in 2003.

According to the 2004 Report, online consumers spent the most on apparel/clothing, followed by the toys/video games category, while the consumer electronics category rounded out the top three.

Categories generating the highest year-over-year growth in holiday dollars included jewelry, flowers and computer hardware/peripherals. Floral retailers experienced a 59 percent surge in online revenue, while computer hardware/peripherals increased 30 percent over last season.

Online Shopping Categories 2004 Holiday Season (Projected revenue in million $)

Category	% of Total	Projected Revenue
Apparel/Clothing	16%	$3,755
Toys/Video Games(hardware and software)	11%	$2,528
Consumer Electronics	10%	$2,306

Source: Goldman Sachs, Harris Interactive, and Nielsen//NetRatings eSpending Report, 2004

Fastest-Growing Categories Year-over-Year 2004 Holiday Season (revenue in million $, growth in %)

Category	04 Online Rev	03 Online Rev	2004/2003 Growth
Jewelry	$1,888	$888	113%
Flowers	$530	$333	59%
Computer Hardware/Peripherals	$2,144	$1,650	30%

Source: Goldman Sachs, Harris Interactive, and Nielsen//NetRatings eSpending Report, 2004

Heather Dougherty, senior Retail analyst, Nielsen//NetRatings, said "Consumers have become accustomed to purchasing online over the years and look to the Internet to find comprehensive product information, competitive prices and easy gift delivery, allowing them to have more time to spend on other holiday activities."

The report showed that overall the majority of online consumers were satisfied with this season's Web shopping experience:

• 37 percent were very satisfied
• 24 percent were somewhat satisfied
• 30 percent of respondents felt this year's online shopping was better than last year

The 2004 eSpending report indicated that:

• 36 percent of respondents cited a preference to avoid crowds as the top reason to buy online rather than visit a store
• 36 percent also cited finding a lower price online was the reason they took to online shopping
• 33 percent said a wide product selection was their top reason to buy online

Source of all data: Goldman Sachs, Harris Interactive and Nielsen//NetRatings