• Advertising Age, Tuesday, November 11, 2008 11 AM

Online retailers are bracing themselves for a tough holiday season, a Shop.org holiday survey finds. Thirty percent of the marketers surveyed said they were trimming their marketing budgets in response to lower than expected sales, while 16% said they were reducing promotional spending.

"(Retailers) are looking to save costs wherever they can," Scott Silverman, executive director of Shop.org told Ad Age. "And they're investing in some of the tactics that they know are going to pay off." Free shipping, for example. A whopping 45% of retailers said their budgets for free-shipping promotions were either significantly or somewhat higher compared to last year.

Online retailers have seen holiday sales increases in the 20% range over the last few years, but given the sudden drop in consumer retail spending, retailers "have reason to put on the brakes." According to Forrester Research, online holiday sales will grow at the slowest rate ever, 12% versus 21% last year. Total sales are expected to top $44 billion in November and December, compared to $33 billion last year.

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