WebProNews

The economy is making online retailers change their marketing tactics in order to acquire and retain customers, according to findings from the "State of Retailing Online 2009," the 12th annual Shop.org study conducted by Forrester Research.

Internet sales continue to outpace traditional retail sales, companies are realistic about current challenges. The survey found more than half (54%) of respondents expect overall retail growth to slow during the next 12 months. Still, companies are optimistic about web operations with four out of five retailers indicating the web is better suited than other channels to withstand the recession and one- third say the downturn has helped them to capture greater market share.

Scott Silverman

"Retailers everywhere are trying to get their arms around a pullback in consumer spending, and online retailers are no exception," said Scott Silverman, executive director of Shop.org.

"Online retailers are trying to weather this economic storm by doing more with less, making smart spending decisions, and leveraging effective, affordable tactics like email to grow their businesses."

Because of the economy, thirty percent of companies are spending less than originally planned on web retail operations. The majority (88%) of retailers are cutting back on hiring and staffing plans and just more than half (56%) will spend less on search.

Others see the economy as an opportunity to increase market share. Almost half of retailers surveyed (46%) have no plans to cut back original budgets and will spend as planned on their web business, while 24 percent of retailers will spend more on their online business that originally planned. Companies planning to spend more will increase investments in several areas, including search (80% of respondents), email (65%), and social marketing (60%).

"Because consumers continue to spend online, interactive marketing spend to drive web sales remains a lucrative investment," said Sucharita Mulpuru, Forrester Research principal analyst and author of the report.

"While other retail channels struggle, eCommerce managers have a unique opportunity to drive more sales and test different tactics that resonate with consumers."