• by Jack Loechner , Staff Writer @mp_research, May 24, 2002

Was online holiday shopping a disappointing ‘lump of coal’ or a breakthrough that doubled the e-tail traffic in ’99? Because of a slow start in the November measurement period, Forrester Research lowered its projection for 2001 online holiday sales from $11 billion to $8 billion, signaling a potential 20 percent drop from last year’s $10 billion. Based on last year’s forecasting model, when sales peaked early in the season and declined thereafter, early projections gave the appearance of a bust (“a lump of coal,” said Reuters).

But in an ensuing report, Charles Buchwalter, vice president of Jupiter Media Metrix, noted that instead of a decline, “the growth trajectory increased each week during the first four weeks of this year’s holiday shopping period, which is in marked contrast to last year, when year-over-year growth rates declined each week.”

In this turnaround in the buying trend, the American population went on a relative “spending spree” on the Internet, and spent more than $11 billion in holiday purchases for the six weeks between Nov. 25 and Dec. 23 (and almost $14 billion in seasonal shopping through the end of December, according to Goldman Sachs). No coal in those stockings.

Jupiter reported unique visitors to shopping sites each week during the 2001 holiday season were up 50 percent compared to the same period in 2000, and up 95 percent versus 1999. Online spending in 2001, according to Harris Interactive, increased 41 in December percent over November. Spending peaked during the first week of December, as more than one in five Internet users made a purchase online.

The definitive report for the holiday season is the Pew Internet and American Life Project, which tracked adult users continuously from November 19 to December 23, reporting that the overall size of the online shopping population has grown to 64 million people. This year 58 percent of Internet users were shopping online, compared to 52 percent last year.

In all, almost 29 million people bought gifts online during the holiday season in 2001 and spent an average of $392 per person. That’s up from the 20 million who bought gifts online last year and spent an average of $330. Just 19 percent of those buyers say they bought most or all of their gifts via the Internet, but in all, 43 percent of online Americans used the Internet to look for gifts, and 32 percent used the Internet to compare prices.

Many shoppers continued to purchase goods online up until the final weekend before Christmas. On Sunday, Dec. 23, the official last day of online shopping before Christmas Day, sales grew by 83 percent. Those who procrastinated spent less than those who shopped in late November or early December. Early purchasers spent an average of $411 on gifts, compared to the late shoppers who spent an average of $366.

Staff writer Jack Loechner can be reached at jack@mediapost.com.