Online clothing sales tops in 2006, Forrester finds

Retail sales will total US$174.5 billion this year, up from US$146.5 billion in 2006

The online sales market is expected to jump by 18 percent this year to US$259 billion, according to a report released Monday by Forrester Research.

The report, dubbed "The State of Retailing Online 2007" is the tenth issued by the research firm in cooperation with the U.S. National Retail Federation's (NRF) network of 600 online retailers.

Excluding travel, Forrester said that online retail sales will total US$174.5 billion this year, up from US$146.5 billion in 2006. The 2006 total represented 6 percent of all retail sales during that year, the report said.

"As consumers flood the Web to purchase merchandise and research products, online retail is moving full speed ahead," said report author Sucharita Mulpuru in a statement. "This strong growth is an indicator that online retail is years away from reaching a point of saturation."

The report found that in 2006, American consumers for the first time spent more money online buying clothes than computers. The report projected that online sales of apparel, accessories and footwear category will total US$22.1 million in 2007, up from US$18.3 billion last year. The 2007 total will represent about 10 percent of all clothing sales during the year.

The report said that clothing sales are increasing for a variety of reasons, including the fact that more and more companies are offering free shipping on product returns and exchanges. Retailers have also improved Web sites with rich imaging capabilities that allow customers to virtually manipulate the merchandise, the report added.

Computer hardware and software, the top online category prior to 2006, garnered US$17.2 billion in sales last year. The automobile and parts category was the third largest segment, with online sales of US$16.7 billion, while home furnishings followed with US$10 billion in online sales.

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