Online Sales Soar - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
Infrastructure

Online Sales Soar

American consumers spent nearly $20 billion buying stuff on the Internet in the first quarter; that's nearly 25% more than they did a year earlier. Yet, online transactions represent only 2.2% of all retail sales.

A new government report makes it clear that more consumers are at ease with buying stuff online.

Americans spent $19.8 billion online in the first three months of 2005, a 6.4% increase from the last three months of 2004 and whopping 23.8% increase from the same period a year earlier, the Commerce Department reported last week. Still, online retail sales represent a mere 2.2% of all first-quarter retail sales.

Economist Anne Wenzel, principal at the economic and market consultancy Econosystems, says more consumers are comfortable with buying goods online, citing a recent University of California at Los Angeles study showing that consumers with three or fewer years of online experience feel at ease making Internet purchases. "It's a change in lifestyle," she says.

Most online purchases fall into selected categories of products, such as travel, books, and music, Wenzel says. Mostly, she says, the Net remains a great place for consumers to research products before purchasing them at brick-and-mortar outlets, such as auto dealerships. "Dining out will never be replaced online," the economist says.

Wenzel sees herself as a typical online consumer, checking out GasBuddy.com to locate the cheapest gasoline prices in her neighborhood. But, she's also buying more books than she had in the past because of deep discounts she can get from online outlets such as half.com. While the majority of online sales replace brick-and-mortar purchases, she says, some transactions represent deals that might never have occurred in the physical marketplace, giving a boost -- albeit a virtually immeasurable one -- to the economy.

The Census Bureau began tracking online sales in fourth-quarter 1999, when Internet retail sales totaled just under $4.5 billion. Then, E-commerce retail sales represented just 0.6% of total retail sales. In the past 5 years, online sales as a portion of overall retail sales have soared by more than 2-12 times.

Census Bureau data is seasonally adjusted; first-quarter 2005 figures are preliminary and fourth-quarter 2004 stats are revised.

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
News
The State of Chatbots: Pandemic Edition
Jessica Davis, Senior Editor, Enterprise Apps,  9/10/2020
Commentary
Deloitte on Cloud, the Edge, and Enterprise Expectations
Joao-Pierre S. Ruth, Senior Writer,  9/14/2020
Slideshows
Data Science: How the Pandemic Has Affected 10 Popular Jobs
Cynthia Harvey, Freelance Journalist, InformationWeek,  9/9/2020
White Papers
Register for InformationWeek Newsletters
2020 State of DevOps Report
2020 State of DevOps Report
Download this report today to learn more about the key tools and technologies being utilized, and how organizations deal with the cultural and process changes that DevOps brings. The report also examines the barriers organizations face, as well as the rewards from DevOps including faster application delivery, higher quality products, and quicker recovery from errors in production.
Video
Current Issue
IT Automation Transforms Network Management
In this special report we will examine the layers of automation and orchestration in IT operations, and how they can provide high availability and greater scale for modern applications and business demands.
Slideshows
Flash Poll