U.S. Online Consumer Sales Surge In 2001.

comScore Networks announced the results of the first complete review of consumer e-commerce for the year 2001, reporting that sales at domestic online retailers surged to $53 billion for the year. Excluding online Travel, comScore reports sales totaled $33.7 billion, reflecting a growth rate of approximately 20% vs. the year 2000.

While in some ways the trend in online sales mirrored that seen in total retail, there were some notable exceptions. Signs of mid-year softness in non-Travel sales were offset by what was – at the time – a strong period of growth in the online Travel sector.

Annual Overview: Total Industry
Following September 11 (and the American Airlines crash of November 12), and as the holidays approached, the Travel sector entered a slump from which it has not yet recovered; at the same time, the Internet became a channel of choice for consumers who sought to defend their quality of life and their budgets with the convenience and price comparison benefits that the Internet offers.

“In July and August, online Travel sales reached a fever pitch, fueled by consumer comfort with buying online, deep price discounts, and new choices in online agencies,” noted Dan Hess, comScore vice president. “But after September 11th, the sector’s sales fell dramatically, before beginning a slow recovery. However, comScore data for the first two weeks of January 2002 show a strong resurgence in online travel spending. Needless to say, we’ll be closely watching the category going forward.”

Noteworthy Days of 2001

As the Internet came into its own as a vibrant shopping venue, comScore’s analysis highlighted key dates and statistics of interest throughout the year.

The highest sales day of the year was Wednesday, December 12th – the height of the holiday season – which posted $321.6 million for the day. The lowest sales day of the year was January 1st. “Online sales on weekend days are generally lower than on weekdays (when many shoppers are able to use the high speed Internet connections at their place of work) – and three-day weekends generally extend that same pattern,” explained Mr. Hess.

The strongest weekend of the year also occurred during the holidays: December 15-16 rang up $341.1 million in sales a level 132% greater than the average weekend. Not surprisingly, the lowest weekend sales were posted over September 15-16, as the wake of the September 11th tragedies was felt in every corner of society and industry.

The average weekend day brings $97 million in sales, but average weekday (Monday-Friday) is a full 60% greater at $155 million, due to increased shopping activity at work-based PCs.

Leading Online Categories

comScore data show that at its third quarter peak, Travel accounted for over 40% of online sales; however, it finished the fourth quarter with the same 32% share at which it opened the year.

Computer Hardware and Consumer Electronics were the hot products of the holidays; together these categories started the year at 19% of total sales and ended 2001 accounting for 24%.

“The trends we’ve seen in Travel, Computers and Consumer Electronics are consistent with more recent reports of overall strength in these sectors at retail,” said Gian Fulgoni, comScore chairman and co-founder, “though the trends were clear in comScore’s online shopping data several weeks before any retail measures were available.”

Online Buying Data Predicts Industry Performance

One noteworthy contrast to the Computer industry’s positive results is Gateway Inc. (NYSE: GTW), which recently reported a significant revenue shortfall. However, comScore data identified this trend well in advance of Gateway’s report. comScore chairman Fulgoni commented that “Gateway’s announcement came as no real surprise to us, since we had seen their online sales declining despite substantial growth in traffic to Gateway’s Web site. It would appear that competitive pricing pressures were at the root of their problem”

“Similarly,” continued Mr. Fulgoni, “comScore data clearly illustrated the surprise softness reported by booksellers in the month of September. Again, this underscores the utility of comScore data as a leading indicator of company and sector performance.”

Brisk Purchase Activity Continues From U.S. Work Machines

Past comScore research was reinforced by the finding that work-based PCs – which comprise less than half of U.S. computers – actually drive almost 60% of U.S. online dollars, with an even greater skew within certain categories (see Table 5).

Armed with the increased speed and convenience of a workplace Internet connection, U.S. online shoppers at work-based PCs buy more often than those at other locations such as Home, Work or Universities. They also spend the most on average per month, followed (in order) by buyers at Home, in Universities/Colleges and non-U.S. buyers.

comScore analysts noted that these findings underscore the importance of targeting advertising and promotional efforts to shoppers when they are at the true point of purchase, research and decision-making.

International Sales at U.S. Sites

comScore’s report revealed for the first time that 15% of total dollar sales at U.S. e-commerce sites are to Web users residing outside of the U.S. “For retailers of categories in which International sales drive substantial revenue, this presents noteworthy opportunities and considerations in marketing strategy and product mix, driven by a more detailed understanding of worldwide category consumers,” noted Mr. Hess.

Demographic Highlights

An analysis conducted on November 2001 comScore data found significant differences in online buying patterns across key demographic segments. For example:

Residents of the Northeast U.S. spend more overall, driven by more frequent buying.

A greater percentage of broadband users buy online vs. dialup users. These users spend 14% more per buyer, and buy more often. Broadband users constitute 38% of visitors but half of dollars. (Note: includes home and work users.)
College Graduates and Post-Graduate degree holders constitute only 24% of visitors, but spend 32% of U.S. online dollars.
Single-family and smaller households spend more on average vs. larger households.

Families in which the age of the head of household is 45-54 spend the most per buyer, at 7% above average.
The percent of Americans age 65+ who buy online is about on par vs. the total population, but these older online shoppers buy less often and spend less when they do.

Households earning $75K+ per year comprise 33% of the U.S. population – but spend 43% of total U.S. online dollars.
A smaller percentage of U.S. Hispanics buy online vs. the total population, but those Hispanics that do shop online spend 7% more than average when they do.

Asian Americans spend more per buyer than any other group.

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For more information at http://www.comscore.com