E-commerce sales show 'relative strength' over holidays

Amazon.com said it had its best holiday sales season ever, but tracking companies find overall online sales dropped compared to a year ago.

Nancy Weil (IDG News Service)
30 December, 2008 07:41
Comments

Tags | online shopping

Amazon.com had its best holiday sales season ever, providing a scarce optimistic report as online sales from November and December were tallied. U.S. online sales over the holiday period showed "relative strength" but were still down and online shopping in the U.K. was markedly off compared to a year ago, according to final reports of the season.

Amazon's sales peaked on Dec. 15, when online shoppers worldwide bought 72.9 items per second, amounting to more than 6.3 million items that day, the company said, although it did not report a dollar total for how much it sold. Wal-Mart and Apple also reportedly had strong online sales.

Overall, though, U.S. e-commerce sales between Nov. 1 and Dec. 24 were down 2.3 percent compared to 2007, according to SpendingPulse, an information service of MasterCard Advisors. SpendingPulse called online sales "an area of relative strength" amid overall holiday retail sales that rank among the worst in recent memory. Even so, this is the first time that online sales have dipped compared to the previous year.

Electronics and appliance sales were down 26 percent overall compared to a year ago, SpendingPulse found. Only luxury items had a worse showing, dropping more than 34 percent, according to SpendingPulse figures for both online spending and brick-and-mortar shopping. Retail sales fell 5.5 percent in November and 8 percent from Dec. 1 to 24, SpendingPulse found.

Poor weather across a lot of the U.S. -- including in a number of major cities -- in the last two weeks of the holiday shopping stretch helped boost online sales because shoppers decided to stay indoors, retail analysts said. Mostly, though, consumers chose to spend a lot less money -- online spending during the winter storms did not make up for lackluster overall sales that were already lower than a year ago because of the faltering economy.

In the U.K., where severe weather was not a factor, 28 million online shoppers said they spent £9.4 billion (US$13.7 billion) online during the holiday season, 20 percent below what the Interactive Media in Retail Group forecast in November, the online payments system, Moneybookers, said Monday.

After the IMRG forecast was released last month, online shoppers scaled back "their festive spend as rising household costs and fears about the economy set in," Moneybookers co-CEO Nikolai Riesenkampff said in a statement. Even so, online sales helped boost sagging retail sales and showed retailers the importance of an online presence, Moneybookers said.