Online Holiday Sales End On An Up Note

A post-holiday bounce capped off a peak season for online sales as both retailers and consumers get more comfortable with doing business over the Web.

In the week ended Jan. 2, Visa USA handled $2 billion in online sales, including travel-related sales, and 25 million online transactions, up 39% and 33%, respectively, from a year ago.

The hike in online sales is a direct result of improved reliability and security luring more consumers to online Web sites and retailers acclimating to "the evolving dynamics" of E-commerce, says Rick Knight, senior VP of operations at Visa's Inovant processing subsidiary.

The holiday season was strong for credit and debit transactions for both online and in-store purchases. During the peak season, between Nov. 26 and Jan. 2, merchants rang up $138 billion in sales using Visa-branded cards, a 20% hike from a year ago. VisaNet, Visa's core transaction system, achieved a peak-processing rate of 5,546 transaction messages per second on Dec. 24, up 8.3% over last year's peak, also on Dec. 24.

In recent years, Visa has remade VisaNet into a service-oriented architecture. It has combined previously separate subsystems for authorizing credit and debit transactions, and done away with a system that merchants and banks used to connect to VisaNet, replacing it with one based on IP messaging protocols. The improvements have lowered the costs of connecting to VisaNet, Knight says, and made it easier for Visa to implement its semiannual system enhancements.