Archive for the ‘Internet Retailers’ Category

Online Retail Sales A Bright Spot?

November 18, 2008

From Internet Retailer:

Online retail sales in October grew a scant 1% over sales in October 2007, Internet measurement company comScore Inc. reports.

“The overall softness in online retail spending was precipitated by curtailed spending across mid- to lower-income segments, with households earning less than $50,000 exhibiting negative spending growth compared to a year ago,” comScore says.

ComScore says it is the lowest monthly growth since it began tracking e-commerce in 2001 and October was the sixth consecutive month of lower growth than the month before.

According to comScore chairman Gian Fulgoni, “October represented the softest single month of online retail growth on record, and we can only hope that the recent sharp drop in oil prices will cause a continued easing of inflation and a strengthening in consumer spending as we enter the critical holiday shopping season.”

Data suggests offline retailers may not have cause for similar levels of optimism.

“The U.S. Commerce Department reported Friday that retail sales, which include autos, gasoline stations and restaurants, decreased 3.3% in October from October last year. The National Retail Federation, the retailers’ trade association, reports that, excluding those three areas, sales decreased 1.3% year-over-year. Auto sales in October fell 25.9% from October a year ago, the Commerce Department reports.”

Online retailers should have a clear indication of whether or not they can expect to eke out a profit let alone break even this holiday season after Black Friday (November 28, 2008) and Cyber Monday (December 1, 2008) arrive respectively.

With the above figures taken into account, online retailers may be the only retail sector with a bright spot this holiday season.

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2008 Holiday Retail Search Traffic Forecast

November 7, 2008

Microsoft’s adCenter blog has posted their 2008 Holiday Advertising Guide for search advertisers.

Some of the guide’s highlights:

“Online retail shopping increases in November by more than 100 percent.1 Adding promotions like free shipping make an enormous difference—57 percent of consumers stated that free shipping is a reason for them to shop online.2 For search and display advertising, online buying will peak on Black Friday, November 28, followed by Cyber Monday, December 1.”

1. Hitwise Market Share in all Categories, 2008.
2. iCongo/Harris Interactive, April 22, 2008.

Based on the percentage of consumer interest and barring any data suggesting otherwise, shipping costs appear to have become the largest remaining barrier to consumers shopping and buying online.

Can elimination of shipping costs insure and increase internet retailers sales prospects this 2008 holiday season?

As the largest online retailer, Amazon.com demonstrated their understanding of the power of free shipping by offering it during the 2007 holiday season.

Amazon is again offering free shipping this holiday shopping season with some conditions through their Amazon Prime Member program.

Amazon Prime

Amazon Prime

In this current economic climate, aren’t internet retailers who don’t follow Amazon’s lead by offering some type of free shipping risking transaction losses to internet retailers – like Amazon – who do?

According to Microsoft’s Holiday Advertising Guide and their traffic data from 2007, Internet retailers can expect four peak search traffic periods during this holiday season:

1. Black Friday

2. Cyber Monday

3. Holiday Crunch

4. Post Holiday

Holiday Search Traffic

Holiday Search Traffic

Important search traffic dates for internet retailers this year will be:

1. Black Friday: November 28, 2008

2. Cyber Monday: December 1, 2008

3. Holiday Crunch: Occurs between December 4, 2008 and December 18, 2008

4. Post Holiday: Begins on December 26, 2008

Internet retailers who advertise free shipping this holiday season can forecast a larger percentage of transactions generated via search from within their market than internet retailers who don’t.