Online Retail Sales on the Rise

Online retail sales climbed an estimated 39 percent in the 2002 holiday season compared with 2001, but the nation's continuing economic malaise and the threat of war with Iraq apparently caused a last-minute slowdown in online sales during the week before Christmas, according to a Reston, Virginia-based consumer research firm.

"At the very tail end--the week or so leading up to Christmas--we did see ... the growth rates slow quite a bit compared to last year," says Dan Hess, a vice president at ComScore Networks. In the 2001 holiday shopping season, there was a last-minute online spending surge that wasn't duplicated this year, he says.

Overall, ComScore estimates, consumers spent $74 billion online shopping in 2002, up 39 percent over 2001. The total includes retail spending as well as online spending for travel accommodations.

In the fourth quarter of 2002, consumers spent about $13.8 billion online, 27 percent more than in the same period in 2001, according to ComScore. Overall, online retail sales alone amounted to an estimated $43 billion in 2002, which is about 5 percent of the retail sales in brick-and-mortar stores.

More Than Ever

Also higher in 2002 was the number of consumers shopping online, with about 10 million people a week shopping online in the fourth quarter--a jump of 32 percent over 2001.

Experienced online shoppers also spent 37 percent more than in 2001, according to ComScore, and they spent about 50 percent more than first-time online shoppers did. "They had a positive experience and then do it more often," Hess says.

The traditional mix of items bought online also changed in the just-past holiday season, he says. Apparel sales increased at a brisk clip, while music CDs, books, and consumer electronics--all leading online sellers in the past--had "lackluster" sales, he says.

Also rising in sales were home and garden items, small appliances, and jewelry. "They're bellwethers [that show that] people are considering this as a place to buy a broad range of products," Hess says.

The figures from ComScore are preliminary and could change somewhat once final tallies are available, he adds.