Byline: Alison Maxwell

WASHINGTON — Online retailers realized sales of $5.3 billion for the fourth quarter of 1999 — or 0.64 percent of overall retail sales of $821.2 billion — according to the Commerce Department’s first ever e-sales report, issued Thursday.
“Obviously, as a percent of all retail sales [online volume] was small, but e-tailing has come of age,” Commerce Secretary William Daley told reporters at a press conference.
The e-sales figure belies the Net’s effect on shopping, Daley noted. “Its impact on what consumers know about what they can buy, or what they should pay,” he said, “goes far beyond today’s percentage.”
Thursday’s e-sales report marked the government’s first formal stand-alone estimate of e-commerce. Further Commerce Department surveys on Internet sales will be published quarterly, with the next data slated to be reported in May.
Business-to-business Internet sales figures will be available from the government early next year.
The government’s monthly reports on the country’s overall retail sales include online revenue, but e-commerce results are not listed separately in those documents.
“Billions of dollars of decisions are being made by retailers, by manufacturers, by investors, who have a need for accurate statistics,” Daley stated. “This number is the new benchmark.”
Kurt Barnard, president of Barnard’s Retail Consulting Group, estimated e-commerce sales could double during this year’s holiday season, amounting to more than $10 billion.
“The Internet may be relatively small today, but it’s growing exponentially,” Barnard observed. “More and more people are buying apparel and everything else online.”
The Commerce Department’s e-sales data is based on the same sample used for the agency’s report on overall retail sales. Commerce sent a screening questionnaire to the 8,800 retailers that receive the monthly retail survey, asking how many had e-commerce sales.
Of the 8,000 firms that responded, 15 percent, or 1,200, said they were doing business online, and served as the study’s sample. They included department stores, apparel stores, new car dealers, furniture stores, mail order houses and grocery stores.
The quarterly e-sales data do not include revenue from online travel services, financial services and ticket sales for entertainment events such as concerts.
At the press conference Thursday, Daley emphasized that if the Internet is to meet its potential, e-tailers must do more to protect their customers’ privacy.
“More privacy protections need to be put in place,” Daley advised. “Policies must be in plain English, not legalese.
“Privacy policy should not be buried in the fine print,” Daley added. “Every poll shows that privacy is why people are reluctant to shop online.”

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