Christian Retailing

Online sales to surpass $200 billion this year Print Email
Wednesday, 24 May 2006 08:00 PM America/New_York

After passing the $100 billion mark three years ago, online sales will top $200 billion this year, according to a new study by Shop.org and Forrester Research Inc. The 2006 State of Retailing Online, the ninth annual study of 174 retailers, found 2006 online sales-including travel-are expected to rise 20% to $211.4 billion. Sales excluding travel should reach $138 billion, the study found.

The largest non-travel categories this year will include computer hardware and software ($16.8 billion), autos and auto parts ($15.9 billion) and apparel, accessories and footwear ($13.8 billion), Shop.org reported. Pet supplies and cosmetics and fragrances are expected to experience growth rates of more than 30%, more than any other categories.

Last year, online sales rose 25% to $176.4 billion; online retail sales-excluding travel-rose 28% to $113.6 billion, representing 4.7% of total retail sales in 2005, the study said.

The study found retailers attempting to streamline their multichannel environment. More than two-thirds of retailers (79%) have consistent pricing across channels, and almost half (46%) allow customers to buy and redeem gift cards online and in stores.

“By encouraging different channels to work together, instead of in isolation, everybody wins,” said Scott Silverman, executive director of Shop.org. “Retailers have been focusing on integrating their Web sites and stores to better serve their customers, which is paying off for companies in the form of higher sales.”

Retailers also reported that 22% of offline sales are influenced by the Web, according to Shop.org. The study also noted that Web sites draw traffic to business, as more than one-third (38%) of online customers are new to a company's entire business.