WEB YULE SALES TOP $12B

Byline: Valerie Seckler

NEW YORK--Internet users shopped early and often enough to transact sales surpassing $12 billion online during December and November. And at that rate, cybershoppers could sustain many of last year's dot-com survivors for at least the first half of 2001.
That's the read from Internet consultant Forrester Research and the National Retail Federation, which released results Tuesday of their December online retail index, developed in conjunction with Internet research house Greenfield Online.
The surprise--and good news--for e-tailers in the fresh figures is that shoppers spent 5 percent more online in November than they did in December. That trend, the researchers noted, bodes well for Web businesses, which need more than one month of robust sales to keep their cash flows churning. It also helps to explain why e-tailers did a better job of shipping holiday orders on time this past season than they did during holiday 1999.
"The most surprising element of this study was that so much of the holiday volume occurred in November," said James McQuivey, director of research at Forrester. "The holiday shipping season used to start the day after Thanksgiving. However, consumers thought ahead about using the Internet and front-loaded the online portion of holiday shopping."
Cybershoppers spent approximately $6.1 billion online in December, according to the new NRF/Forrester index, down from the $6.4 billion they spent the e-way in November. Forrester is estimating around $4 billion of the $6.4 billion in sales during November were transacted for holiday purchases. "That really surprised me," offered McQuivey, who expected holiday sales online to split at just $3 billion in November, with the balance coming in December. "That so many people shopped early made December more bearable for e-tailers who struggled with fulfillment and shipping in 1999," he observed.
Intriguingly, while fewer of the Net's denizens shopped the Web in December than November, they spent more the e-way, on average, in December--in part because of a pickup in purchases of jewelry, the category that cornered the biggest month-to-month percentage sales gain (see chart). Sales of jewelry online came to roughly $180 million for December, a threefold leap over the sector's sales of $56 million on the Net a month earlier. That surge in demand for high-ticket items helped lift the average amount spent online during December to $308.44 per person, an 8 percent increase over the $285.34 they spent, on average, in November.
About 20 million people shopped the Web during December, down 11 percent from the 22.4 million who did so a month before, NRF and Forrester found. The NRF/Forrester Online Retail Index was based on 5,000 responses from a panel of Net users developed by Greenfield Online. The survey for December was taken between Jan. 2 and Jan. 12, and data from that panel is weighted to be demographically representative of North America.
Apparel, while not trumpeted by the takers of the new study, still saw its share of holiday action, ringing up the second-highest sales total among small-ticket items bought online in December. The Forrester/NRF index shows $501 million of apparel was purchased on the Net last month, versus the $598 million spent on toys and video games. In November, by comparison, e-purchasers spent $525 million for apparel, and $673 million on toys and video games.
So, what's the big picture portrayed by all the new numbers?
"Online shopping is pretty healthy," responded Scott Silverman, NRF's vice president of Internet retailing. "The Internet seems to be catching on with consumers who appear to be making it a part of their overall shopping habits. Generally, we estimate retailers will realize 25 percent of their [full-year] sales during November and December," Silverman added. "Online retailers did 25.9 percent of their sales in that period."

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