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Written by admin on June 25th, 2008

Online Sales In America Aren’t Slowing Down

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Considering how the economic landscape is looking particularly dismal, it comes as a notable surprise that, regardless of how the economy is slowing down in some areas, online retail sales in the US are expected to continue to increase by roughly 50% over the next five years and to exceed $300bn. This estimate is made according to the work of Forrester Research and was prepared for Shop.org, the premier national association of internet retailers.

This comes as a great deal of relief for investors looking to relax their tensions concerning an economy that is tumultuous, to say the least. Scott Silverman, the executive director of Shop.org, gave an apt description of the situation and the kind of demand that is being made of online retailers. He described the situation as having shoppers who are split into two fundamental groups: one that is affected by the shaky economy and is made up of people who are using the internet as a means to save money and do comparison shopping, while the other group is composed of those people who aren’t bothered by the economy and continue to purchase goods online because of the sheer convenience found in doing so.

Making truth known towards that end, the report predicted that sales would increase by over 16% and reach $204bn, or 7% of the total retail sales in the US, defying the general slowdown present in consumer spending. This prediction is based on the results of last year, including the sales of clothing online which was the most valuable category, reaching over $22bn, exceeding the sales of computer electronics, peripherals and software, which taken all together were worth over $20bn.

This positive change in the market continues to present the proverbial sliver lining on stormy clouds in the current year, leaving investors and shareholders with a sense of relief that the predicted recession will not occur or, at the very least, will have its impact reduced significantly. Stocks continue to rise for companies producing electronic goods and, most notably, those companies that sell said goods by means of the internet. For example, computer game maker Nintendo had its stock rise by 3.9 percent while Amazon.com, a leading provider of miscellaneous goods, saw its stocks rise favorably as well.

Concerning the marketing of online goods, the report underlined and emphasized efforts made towards paid search-engine advertising and e-mail. In fact, it shows that up to 90% of respondents used paid search results and a even higher amount used e-mail advertisements, which include sales events and sometimes coupons. Retailers manage roughly over 32,000 search terms and send at least 70 e-mails per year year to their customers, spending over $2m on their efforts.

For the future, Scott Silverman mentioned that retailers will be experimenting with original initiatives, including but not limited to social marketing by means of community websites and even marketing that is mobilized on cellphones and other portable electronics. This is expected to yield good results and will factor in on how the online market continues to improve during the fiscal year and beyond.

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