Paid Inclusion

November 2, 2004

According to projections released by JupiterResearch, online retail sales will reach $21.6 billion this holiday season. Such numbers would mark a rise of 19 percent over 2003, the market research firm said.

Nearly 86 million Americans are likely to make purchases online this season, compared with 73 million last year, it said.

JupiterResearch is also predicting a 2 percent jump in spending per buyer compared with last year.

In addition, U.S. consumers will expand their range of purchases beyond the traditional top-selling categories of toys, books and apparel.

"Over half of online holiday shoppers say they will use the Web to get gift ideas or to seek better prices," Patti Freeman Evans, a JupiterResearch retail analyst, said in a statement.

"To capture these customers this holiday season, retailers are wise to use e-mails to alert customers who have left items in their shopping carts or wish lists when the price changes or inventories get low on those items."

Jupiter's projections are at variance with the data released by Forrester Research recently.

Forrester predicts holiday sales to be around $13.6 billion. However, Forrester defines the holiday season as between Thanksgiving and Christmas, while Jupiter's holiday projections cover the whole of November and December.

But like Forrester, Jupiter's predictions indicate slowing growth in online holiday sales. Jupiter recorded a 31 percent jump in holiday sales from 2002 to 2003.

"Despite the strong online sales forecast, many offline retailers are expecting a 'tight back-end,' or a challenging fourth quarter, due to the back-to-school sales bust," the Jupiter report stated.

"The positive September retail sales results notwithstanding, continuing economic, employment and global political uncertainties have influenced retailers to plan their inventories carefully this year."

Source: C-Net News