Online Sales: The Bright Spot of the 2002 Holiday Season

Though overall sales may have lagged during the 2002 holiday shopping season, a notable increase in online purchases gives catalogers reason to keep their chins (and hopes) up.

Consumers spent almost $13.7 billion online during the 2002 holiday-shopping season, marking a more than 24-percent, year-over-year increase from 2001, according to the eSpending Report from The Goldman Sachs Group, Harris Interactive and Nielsen/NetRatings.

Compounding this is a new survey from The Direct Marketing Association, which found that 78 percent of catalogers increased their holiday Internet sales in 2002, with an average percent increase of 47.3 over the 2001 holiday season.

Several catalogers said these results mirrored their own holiday experiences. Home accessories cataloger Cuddledown reported a 20-percent increase in its holiday online sales from 2001, as compared to a 7-percent increase for print catalog sales, according to Karen Stebbins, inventory manager.

Omaha Steaks saw a 30-percent increase in its online holiday sales from 2001, with general site traffic increasing 35 percent, says Beth Weiss, public relations manager.

Even smaller catalog companies enjoyed the online trend. Niche cataloger The Astronomical Society of the Pacific saw a 7-percent increase in online sales (from 13 percent to 20 percent) from October to December over the same period in 2001, reports Joycelin Craig, manager of sales and marketing.

The eSpending report also revealed buying patterns that reflect catalogers’ observations:

• Sales levels peaked at the extreme points of the season — beginning and end.

• E-tailers benefited from e-mail promotions early on in the season. Several catalogers interviewed had sent e-mail promotions offering free shipping during the week after Thanksgiving, and all reported favorable results. John Rogers, director of e-commerce at Orvis, says, “I think consumers are starting to look for [free shipping] at that time of the year. There’s some conditioning going on.”

• The greater number of buyers toward the end of the season indicates that consumers seemed more comfortable with last-minute shopping and shipping charges. Rogers believes last-minute Internet shopping has more to do with smart consumerism than procrastination. “People are in stores early on, and they go online later. The educated, more affluent consumer is looking for a more competitive price.”

Catalogers’ opinions varied on why the Web is becoming such a formidable holiday channel. Some credit an increased acceptance of the Web as a reliable sales channel. “Some people who, in the initial days, were concerned about giving their personal information online, aren’t as concerned anymore,” asserts Weiss. “More people shop online with confidence now.”

Others noted the ease of gift shopping on the Web. But most said they viewed the online holiday sales increase as a natural outcome of consumers’ growing acclimation to the channel.