Online Retail Sales Grow

Online retail sales in the United States increased to $11.9 billion in the first quarter of 2003, an increase of 25.9 percent compared to the same period one year ago, according to figures released by the Census Bureau of the U.S. Department of Commerce.

That's down 13.4 percent from the fourth quarter of 2002, when online retail sales totaled an estimated $13.8 billion, according to the report. Overall U.S. retail sales, most of which come from sales in brick-and-mortar stores, were down by 10.7 percent from the fourth quarter.

E-commerce remains just a sliver of the overall U.S. retail sales picture, according to the Commerce Department figures. Total retail sales across the nation for the first quarter of 2003 were estimated at $772.2 billion, an increase of 4.4 percent from a year ago.

The online sales figures made up just 1.5 percent of the total first-quarter sales figure, up from 1.3 percent one year ago. In the fourth quarter, e-commerce accounted for 1.6 percent of total sales.

In Its Infancy

Carol Baroudi, an analyst at Baroudi Bloor in Arlington, Massachusetts, said the figures show that online retail sales continue to be important even during the downturn in the U.S. economy, which has affected both online and brick-and-mortar retail sales.

"The fact that sales are down is due to the economy at large," Baroudi said. "We know that e-commerce is still in its infancy. It's not going away."

Online purchasing continues to be many shoppers' preferred buying method, she said. "It will continue to be a legitimate channel and a preferred channel for many shoppers, who'd actually prefer not to go into another retail store ever again. Some have actually accomplished that."

Retail e-commerce sales are estimated from the data used in the Monthly Retail Trade Survey. To estimate preliminary and final U.S. retail sales, a random sampling of sales data is collected from about 11,000 retail companies and then weighted and benchmarked to represent some 2 million U.S. retail businesses.

The report doesn't include data for online travel services, financial brokers and dealers, and ticket sales agencies, which are not classified as retail by the government.

The second-quarter retail e-commerce sales estimate is scheduled for release in August.