Online Retail Sales to Hit $211 Billion: Report
Just three years ago, online sales reached $100 billion. And this year, that number is expected to soar past $200 billion, according to a new study.
Online sales this year, including travel, are expected to rise 20% to $211.4 billion, according to The 2006 State of Retailing Online, the ninth annual Shop.org study conducted by Forrester Research, Inc. Excluding travel that number will hit $138 billion.
Last year, online sales rose 25% to $176.4 billion. Online retail sales (excluding travel) reached $113.6 billion, up 28%. Online retail sales represented 4.7% of total retail sales last year, the report found.
Retailers are using a number of strategies to boost online as well as at brick-and-mortar sales.
More than two-thirds of retailers have consistent pricing across channels (79%), and about half (46%) let their customers buy and redeem gift cards online and in store. Some 33% of companies let customers build loyalty points across channels and offer in-store product information online (26%), according to the study.
“By encouraging different channels to work together, instead of in isolation, everybody wins,” said Scott Silverman, executive director of Shop.org, in a statement. “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.”
The report also found that 22% of offline sales are influenced by the Web, with 38% of online customers new to a company’s business.
Privacy and security remains top of mind for consumers shopping online and retailers are delivering.
Some 63% of retailers require card verification value codes at checkout with 25% accepting private-label cards, 12% offer third-party e-mail payment options, 9% accept eChecks and 7% offer third-party credit accounts.
“Companies are now able to take a step back and are busy planning strategies and prioritizing technology investment for the long term,” said Carrie Johnson, lead author of the report and research director, VP at Forrester Research. “As a result of these efforts, the next five to 10 years of online retail will be even more competitive and more innovative than in the past.”
