Studies show online holiday spending uncertain

ComScore is expecting a 20 percent increase, but Nielsen believes a drop in overall budgets might slow growth

Researchers at comScore are expecting a solid online shopping season, but another research group isn't so sure.

For the first 18 days of November, comScore reported more than US$7 billion in online retail spending. That's up 17 percent over the same period last year, which brought in US$6 billion. The growth happened even though the first week or so of the month showed only modest gains compared with the year earlier. Roughly the last half of the period studied grew by more than 20 percent compared with last November, comScore found.

ComScore is predicting that shoppers will spend US$29.5 billion during the months of November and December this year. That would be a 20 percent increase over last year, which brought in US$24.6 billion.

However, another researcher is warning that online spending might not reach the same growth levels that it has in recent years. A study conducted by Nielsen Online found that shoppers expect to spend the same portion of their holiday budget online as they did last year. Because overall spending might be down due to broader economic factors, the dollar amount spent online might not live up to the historical 20 percent growth, Nielsen warned.

Thirty-five percent of respondents to the Nielsen study said they expected to spend between 25 percent and 50 percent of their holiday budget online. That's similar to what Nielsen found when it conducted a similar study last year.

The studies revealed a couple of other interesting findings. According to comScore, the two months at the end of the year typically bring in about one-quarter of annual online consumer spending. From January through October this year, buyers spent $93.6 billion in online shops.

ComScore's figures exclude auctions, travel-related purchases and large corporate buys.

People shop online mainly for convenience, Nielsen's research showed. Out of about 1,000 respondents to the survey, 81 percent said the ability to shop any time was why they chose to shop online during the holidays. Saving time was the next most popular reason, with 77 percent of respondents citing that as motivation for using the Internet to buy gifts, Nielsen found.

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Nancy Gohring

IDG News Service
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