Ho Ho Dough! $24.3B For Holiday Season

    November 3, 2006
    WebProNews Staff

Broadband connections will help online retailers see $24.3 billion in sales for the 2006 holiday shopping period, a 22.1 percent rise over 2005.

Jeffrey Grau of eMarketer suggested the months of November and December should provide plenty of jingle in the pockets of Internet retailers. The key to this will be the most important customer a business has – a repeat customer.

When I worked for a catalog retailer, I learned from a veteran catalog man named Tim O’Malley just how important repeat customers were to a business. It costs a lot more to acquire a new customer than to keep an existing one.

Since he had a shelf full of Catalog Age gold and silver awards, it was pretty easy to tell that the industry respected his opinions. That company did very well in business and stood atop its niche, with plenty of repeat business, giving him real-world validation for the argument favoring loyal customers.

Grau cited a trend where this year’s selling will follow that philosophy. “Sales growth will come this holiday season less from e-commerce newcomers and much more from experienced online buyers who increase their spending,” he said.

Internet retailers have been able to parlay guarantees of holiday deliveries to the week preceding Christmas into greater demand for their goods. Faster connections in the homes of holiday shoppers make it easier for retailers to provide enough product details and images to replace the hands-on shopping experience.

The most compelling detail provided by Grau said the robust growth of online spending comes when the retail sector as a whole expects five percent growth in US holiday sales, the lowest growth figure since 2003.


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David Utter is a staff writer for WebProNews covering technology and business.