U.S. Consumers Remain Bullish On Online Shopping This Holiday Season
This holiday season, consumers are expected to do a lot more online than check out the latest update on the presidential election.
According to Ernst & Young's fourth annual Global Internet Retailing study, online shoppers surveyed report they have spent an average of $896 on the Internet over the last twelve months. With the emergence of multi-channel players such as Neiman-Marcus, Saks Fifth Avenue, Nordstrom, Target, Wal-Mart, Macy's and others this holiday season, the 1,400 US consumers surveyed estimate they will spend 29 percent of their total holiday purchases over the Internet, up from just 16 percent a year ago - a nearly 100 percent increase.
Ernst & Young LLP found that the number of people doing at least half of their shopping online will increase significantly. In 2000, one-fifth of online shoppers (20 percent) plan to do at least 50 percent of their holiday shopping online, up from less than one in ten (9 percent) of shoppers in 1999. Conversely, the number of online consumers who have no plans to shop online during the holidays dropped from 40 percent last year to 13 percent this year.
"This will be a very interesting online holiday season - strong at the upper and lower ends of the price spectrum and very promotional for most retailers in between," said Stephanie Shern, Global Director of Retail and Consumer Products at Ernst & Young. "We see total online retail sales in the US for full year 2000 in the $38 billion range, excluding travel and automobile sales, and the volume for the holiday season will be around $11 billion."
Favorite Sites For Holidays? Consumers Split on Multichannel vs. E-Brands
The E&Y study shows there is a very different group of companies selling online this holiday season, and shoppers' favorite sites this year reflect the trend toward well-known multi-channel players and away from large e-brands. While Amazon.com is still the respondents' favorite site, familiar, traditional multi-channel brands such as JCPenney.com, WalMart.com and BestBuy.com will take an increasing share of online purchases leading into 2001.
Most popular US Online sites from which consumers purchased over the last 12 months are:
1) Amazon.com 2) Barnes&Noble.com 3) Ebay.com 4) JCPenney.com 5) Cdnow.com 6) Drugstore.com 7) Fingerhut.com 8) ToysRUs.com 9) PlaneTix.com 10) Disney.com 11) Walmart.com 12) QVC.com 13) Bestbuy.com 14) Cyberate.com 15) 1800flowers.com Shoppers Go Broad and Deep Into New Online Categories This Season
This holiday season, online consumers are expected to shop in broader categories than before. In addition to books, computers and CDs, top categories for online buyers this year now include apparel and health and beauty, with apparel surpassing toys in category popularity:
Most popular US Online categories from which consumers purchased over the last 12 months (percent represents number of consumers who purchased in the category over the last 12 months) are:
- Books (52 percent) - CDs/Recorded Music (49 percent) - Computers (49 percent) - Apparel (37%) - Tickets (29 percent) - Reservations (29 percent) - Toys (28 percent) - Electronics (28 percent) - Health and Beauty (25 percent)
"Ernst & Young believes that to win in online retailing, companies must excel in meeting or exceeding customer expectations and improving the customer relationship through world-class operations and merchandising," said Shern. "We see the e-winners as those companies who are implementing a multi-channel strategy so consumers see a consistent and integrated brand at the corner store or the online mall."
Online Convenience is King Again This Holiday Season
The reasons why consumers like to do their holiday shopping online are consistent with last year's findings - saving time is the main driver. Those who will plan to spend the same or more online in 2000 compared to 1999 prefer shopping online because:
Saves time (62%) Stores/malls too crowded (56%) More convenient shopping hours (50%) Less driving (45%)
The holiday online shopping study was conducted in conjunction with Ernst & Young's comprehensive Global Online Retailing study of more than 7,000 consumers in 12 countries, the findings of which will be presented at the National Retail Federation's annual conference on January 16, 2001 in New York.