Online Sales Up in the US for Some
In a report from eMarketer there is a mixed bag of news for online sales from Q1. The study that was done by Forrester Research and Shop.org shows an overall increase in online sales of 11%. Nice number for sure considering the daily doom and gloom that seems to dominate the economic news of most days.
Digging into the findings just a bit reveals how that increase is not something that appears to be felt across the board. Overall, 58% of those using the online sales channel experienced an increase in sales. When you put it that way it seems to say that the increase may be more a result of some areas showing bigger increases which were offset other poor performers. The chart below reveals the weak spot.
Of online or web only merchants 6 out of 10 reported sales were either flat or they declined during this same period. One guess as to what this means could be that less people are leaving their homes to go to the stores that they normally would (to save on gas, eating out and other activities related to shopping at a physical store) but still buying from those same merchants online.
If that is the case, then this number could be a little deceptive. The more telling number is the experience of online only merchants which says they didn’t have such a good quarter. eMarketer sums it up with the following
In the survey, about 70% of both consumer brand manufacturers and multichannel retailers reported online sales increases. However, Web-only merchants had a different situation. About six in 10 reported Web sales declines.
Taking the role of the optimist Citi Investment Research feels that overall there will be a 4.4% increase this year followed by the more familiar double digit increases (16.5%) in 2010.
Since no one’s crystal ball seems to be calibrated correctly these days it seems more prudent to look at the past quarter to get an idea of what might happen in the current quarter. I think we have enough evidence that predictions in general are at best an educated guess with most predictions extending past even 6 months being more of a crap shoot than ever.
So it makes sense to keep an eye on the web only retail performance as we move either deeper into this recession or head out of it. This climate is the first real test of just how influential online is in the mind of the majority of consumers. If these first quarter numbers are any indication it looks like a lot of people still like stores and that affinity may even impact online behavior as well. Maybe this will serve as a wake up call to web only merchants that they need to do something different if they want to truly get people away from their habit of shopping with retailers that they can drive by on the road as well as surf by online.