Byline: Valerie Seckler

NEW YORK — The fashion business is piercing the pall over e-commerce: It rang up apparel sales of $368 million online in March — one of two categories that led a runup to revenue of $3.5 billion spent the e-way last month by U.S. consumers.
Those results were based on a new monthly survey of approximately 39,000 Internet users, conducted by Nielsen/NetRatings and Harris Interactive, which showed spending for apparel on the Web surged 122 percent in March versus April 2000, while the overall spending figure represented a 36 percent increase from sales of $2.6 billion transacted online during April 2000. Online travel, the fastest-growing category on the ‘Net last month, saw its transactions soar 59 percent, totaling roughly $1 billion, according to the study.
“Apparel is holding its own online,” observed Sean Kaldor, vice president of e-commerce at Milpitas, Calif.-based NetRatings Inc. “Sales in the category were $1.3 billion in the first quarter, a 108 percent increase over the first quarter of 2000.” Although the March apparel spending figure represented a retreat from the $394 million spent on the category in February and the $528 million spent in January, Kaldor noted: “Apparel is recovering from the holiday burst. Most apparel e-tailers still seem committed to the Internet, versus other sectors, such as groceries and toys.”
Fashion goods are sold at three of the 10 e-tailers possessing the biggest share of purchasers among its shoppers in March:, which ranked seventh, as 3 percent of its 3.3 million users, or 99,000 people, bought something on the Web site; eBay, which ranked second, with 14.5 percent of its 19 million visitors, or 2.8 million people, transacting a sale; and Amazon, which topped the chart, as 15.1 percent of its 23 million shoppers, or 3.5 million people, purchasing from it.
It’s not exactly a surprise when two sets of research turn up different results about online behavior. The interesting wrinkle in the latest March shopping data, however, is that both Nielsen/NetRatings and the Forrester Online Retail Index, also released last week, found U.S. cybershoppers spent about $3.5 billion on the Internet last month. Still, there’s some murkiness stirred by the category breakouts. Cambridge, Mass.-based Forrester Research, which, along with other Web watchers has become a sacrificial lamb of the dot-com fallout for some overblown e-business estimates, found there was about $178 million spent for apparel online last month, substantially less than the $368 million reported by Nielsen/NetRatings.
One possible explanation is the difference in methodology. The Nielsen/NetRatings research is based on an online survey of 39,000 cybershoppers, covering more than 300 e-commerce sites across 14 vertical markets, and is integrated with data collected from a Harris Interactive panel of more than seven million Internet users. The Forrester index, by comparison, is founded on 5,000 responses from a cyberpanel developed by Greenfield Online. That monthly panel is weighted to Forrester Research’s consumer technographics benchmark group of 10,000 Americans and Canadians who are part of a consumer mail panel developed by market researcher NFO Worldwide.
The $178 million spent the e-way for apparel in March, according to Forrester, was off 13 percent from sales of $201 million in February. Forrester will start offering year-over-year comparisons with its figures for April, the first anniversary of the online index. And while these figures vary from those of Nielsen/NetRatings, the trend line is the same: There was a 7 percent monthly drop in online sales of apparel last month, versus February, according to N/NR.
Apparel wasn’t the only style-driven category to see its sales stumble on the Web last month, according to Forrester: Purchases of jewelry declined 19 percent, to $85 million from $105 million in February, while demand for health and beauty merchandise was off 8 percent, totaling $111 million against $121 million. Footwear, in contrast, rang up a 38 percent increase to sales of $54 million from $39 million a month earlier. Additional small-ticket categories achieving monthly gains included sporting goods, toys and video games, garden supplies, tools and hardware, office supplies, computer software, books, music, and videos.
Overall, Forrester found consumers spent an average of $263 online in March, up from $248 in February, with the number of households shopping the Web holding steady at 13.5 million.
“Online shopping is not trivial when more than 80 percent of all Web surfers and nearly one of every two Americans are involved,” Kaldor said in referring to Nielsen/NetRatings data showing that 100 million people in the U.S. have bought something on the Internet.
“Despite challenges in the U.S. economy,” he concluded, “online spending is staying strong, even gaining 4 percentage points from February to March 2001.”

Digital Snapshot: eWorld 2001 Cybercast
During the next four years, the number of Web sites will double, e-commerce will expand tenfold, and technology investments on ‘Net applications will climb fourfold from levels in the prior four-year period.
Companies worldwide will shell out more this year on Web site infrastructure than they did in five years to prepare for Y2K.
More than $700 billion will be spent online by U.S. consumers for goods and services by 2005.
Of the 40 percent of companies that can take orders on their Web sites, 81 percent do business with consumers.
While 40 percent of Web sites can take orders, fewer than 10 percent of them can handle payments for those goods and services purchased online.
Two out of three Internet executives consider themselves risk takers, while only 10 percent of information technology professionals characterize themselves that way, which sets the scene for political battles and personality conflicts that could prove as challenging as technological issues.

Source: IDC’s eWorld 2001 survey, a poll of consumers, business executives, and information technology specialists in 27 countries.