Late holiday shopping rocketed up 57 percent, according to an Internet Retailer report on comScore figures. Operational improvements in e-commerce companies seem to be allowing more and later shopping to get in prior to Christmas. In the week prior to Christmas, sales grew to $2.45 billion. Across online and offline retail, sales were down almost six percent over about the same period, according to ShopperTrak figures. $13.5 billion was spent between the beginning of November and December 19, according to comScore, up more than a quarter from last year. Online shoppers spent $64.2 billion in 2004 to date, up 26 percent from last year.Update II: A few more from MarketingVox:
Visa reported that its online card usage grew 57.8 percent in the week leading up to Christmas, comprising $1.83 billion in holiday spending, according to Internet Retailer. Interestingly, the day before Christmas showed a slight decrease in spending (1.1 percent). The number of transactions grew to 23.7 million, up 43.1 percent. Visa e-commerce sales for the last two months totaled $17.83 billion.
If that last post wasn't enough, here's some things Jacob Nielson thinks you should do to get your site ready for the Holiday rush. (He posted it back in September, so even though I'm showing it too you too late for the Holidays, think of them as tips to improve your site for the New Year.)
(Thanks to The ConversionRater for leading me to this and the Dell article referenced below.)
Jacob Nielson says some wise things, which culminate in this:
"In the virtual world, you win by being good: Automation reduces the benefits of scale, the Internet equalizes distribution, and reputation follows from quality rather than incessantly repeated slogans.
Worth reading and thinking about, as are the comments from Robin Good that led me to it.
Fred Wilson points out some interesting comments from Howard Morgan, and adds some of his own insight:
Howard showed us the basic economic equation for online commerce, which is:RPC - CPC = Profit
RPC is revenue per click
CPC is cost per clickThe Comscore data seems to indicate that this formula may no longer hold because two big things are happening this holiday season that portend big changes in ecommerce and search.
Trend 1 is the emergence (finally) of the multi-channel retailer (retail, catalog, online, etc) as a major player in online commerce. Walmart, Target, BestBuy, and others are having huge holiday seasons this year. They finally got the web right!
Trend 2 is the latency of online searches (the searcher often buys as long as 30-60 days after doing the search) and the fact that over 90% of searchers actually make the purchase offline.
If revenue per click is recognized in the Best Buy store in the mall three weeks later, then cost per click is going to go up and may go way past immediate online revenue per click.
This portends well for Google, Yahoo!, etc and very well for the multi-channel retailers. It's going to be a challenge for the single channel online retailers.
While I have no doubt about Fred's comments in the short run, I think there is an important 'future trend' to keep in mind: a large portion of the long sales cycles and offline buying occur because online commerce still isn't addressing the complete needs of shoppers. In other words I think a lot more of these sales will happen faster, and stay online, once some more progress is made in the quality of the online shopping experience.
There are lots of reasons why people delay purchases - and many of the won't every go away. But a huge number of purchases are delayed because the customer (consumer, prospect, humaniod, what-every) isn't fully satisfied in terms of product or comparative information, pricing or terms, shipping or delivery issues, etc.
It's been a long time since the general shopping experience at online stores improved. The technology base of most merchants, and their back-office, has received a lot of attention over the past three-four years. But at all but a few stores shoppers still see a picture, price, and paragraph - just like they did back when mail order catalogs were high tech. The result is that buyers are essentialy forced to search out 'pre-sales' information in forums, on affinity sites, in online reviews, and by emailing friends - all activities that pull them out of the sales cycle and often lead them to delaying the purchase.
As merchants increasingly learn to measure what's going on at their sites, and then start figuring out the reasons behind the still massive abandonment rates and generally abysmal conversion rates they live with, we're eventually going to see that if they really educate and sell online, they'll get the sales online.
We're doing more work on the B2B side lately, and I came across two blogs tonight that take interesting looks at this area of the online world. The first is Brian Carroll's B2B Lead Generation Blog, and the secondis Mal Watlington's Online Conversion and Beyond.
Brian looks at the front of the process - how leads are generated and marketing programs executed for B2B and long-lead sales. Mal focuses on the post-lead process, discussing ways that the B2B world can track and measure conversion and satisfy customers after the sale.
Clearly there are differences between the way B2B and B2C companies need to do business online, and its great to see resources dedicated to the former.
(Thanks to Anthony Garcia at FutureNow for the original pointer.)