US E-Buyers Increase Average Spending by $223 This Year.

In its latest report, Retail Industry Online, eMarketer estimates that US internet users will increase their annual online spending from an average $866 in 2001 to more than $1,089 by the end of 2002. The report also notes that sales data from online retailers indicate that repeat customers account for a growing portion of online sales, and these same customers are typically spending more each time they buy online.

“With the number of online shoppers continuing to grow, US consumers are also spending more online, thereby creating a healthy prognosis for internet retailers across the board,” says Steve Butler, Senior Analyst at eMarketer. “One significant result is that online retailers’ customer acquisition costs are falling.”

Repeat business from customers who are more comfortable with making online purchases has helped bring down the average customer acquisition cost by 60%. Shop.org and the Boston Consulting Group estimate that acquisition costs fell from an average $38 per customer during the dot-com boom to $14 per customer in 2001.

Retailers also reduced expenses by reining-in marketing costs, which fell from $26 per order in 1999 to $12 per order last year. Drawing on data gathered from more than 45 leading online and offline research firms, the Retail Industry Online Report helps readers understand the key trends that are shaping the future of online retailing.

Additional information included in the report:

Solid retail sales have encouraged retailers to continue spending on IT, with 45% of respondents to a Gartner survey saying that they plan to upgrade their websites during 2002.

Although the retail industry spends a great deal on online ads, most traditional retailers are still spending less than 1% of their advertising budgets online.

Multi-channel retailers have begun to take advantage of their brick-and-mortar stores by permitting in-store product returns, with in-store pickup to follow soon.

Get your company ready for the 2002 shopping season online. Learn more about eMarketer’s just-released Retail Industry Online Report.

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