The Vast Majority of Retailers Expect Growth in Online Sales This Holiday Season

11/01/2008

With the economy the way it is, one would expect that retailers wouldn’t bank on growing their online sales this holiday season. However, in spite of the economy, over eighty percent (81.1% to be exact) expect growth in their holiday web sales this year, according to the most recent Internet Retailer survey.

Online Retailers Have an Edge over Their Brick-and-Mortar Counterparts

The web presents a distinct advantage for Internet marketers during challenging economic times. One of these has to do with customer perception. Most consumers believe that they can buy things cheaper online.

This is coupled with the fact that online shopping has an affluent customer base. It takes much more of an economic hit to make the affluent shopper change his/her shopping habits than the average Joe. This is because the economy affects this base to a lesser degree than the average online shopper.

Internet Retailer’s holiday sales survey was given to 220 web-only retailers, chain retailers, catalogers and consumer brand manufacturers. Of these, almost a quarter (23.9%) expected online sales to grow by 5% or less. Almost twenty percent (18.3%) expected online sales to grow between 5 and 10 percent. Five percent expected sales to grow by more than 50%.

Some e-tailers say that while recent economic events (e.g., bank failures) may temper growth for some, many still expect to be OK for the holiday season.

In spite of their cautiously optimistic outlook, almost three-quarters of retailers say they realize that the current economic climate will have an impact on sales. And, many of them are actively working to combat this.

Some steps they’re taking include offering lower-priced items (37.6% planned to do this); early holiday promotions (36.7% plan to implement this); lowering prices (29.4% planned to engage in this); and free gift incentives (21.6% planned to offer this with a purchase).

Most of these are proven tactics that help boost sales. Some other sales-propping tactics retailers say they plan for the holiday season are working more closely with affiliates and offering invitation-only sales.

Are Retailers Overreacting to the Economic Crisis?

One thing experts caution retailers to guard against as they go all out to shore up holiday sales is overreacting to the economic crisis. Experts point out that there is little retailers can do to override how consumers think. If consumers are panicky, scared or negative, they tend to spend less – even when they can afford to spend more.

And, this is what most retailers fear this holiday season – a pessimist outlook by consumers. However, online retailers are holding their positions through the storm and have been affected less adversely than their brick and mortar counterparts.

For more insight visit Ecommerce Development Services