Shop Talk

Retailers, consumers and prices

Slump means market share gains in E-commerce

May 5, 2009

AMAZON/RESULTSWe know the U.S. recession is gloomy for retailers, online stores included, but at least a third of these e-commerce sellers say they’re taking greater market share amid the slump. 

That’s according to Shop.org and Forrester Research in a marketing study based on their annual State of Retailing Online report. Shop.org is a division of the National Retail Federation.

The survey of 117 online retailers showed that, despite the economic downturn, some 46 percent of respondents said they would spend as planned on their web businesses, with no scale-back of original budgets. Moreover, a quarter said they’d spend even more than originally planned, while fewer than a third said they’d spend less.

“As weak retailers disappear from the eCommerce landscape, companies that remain do have an opportunity to capture orphaned shoppers,” the report said.
 
Online retail has continued to outperform the brick-and-mortar retail environment, which has been hurt by lower mall traffic as shoppers try to avoid all but the most necessary shopping trips.
    
Analysts have pointed to Amazon.com as the online retailer finding the most success getting consumers to shop. With a strategy of lowered prices, increased selection and a discount shipping program, the Seattle-based e-commerce giant has managed to beat sales forecasts in its last two reported quarters. 
    
In January, Forrester forecast a 11 percent jump in total U.S. online sales to $156 billion, representing 6 percent of the overall retail pie.
    
With a renewed push for customer acquisition — and retention — some 88 percent of retailers listed email communications as a high priority for 2009, higher than paid search, which is more expensive.
    
And, demonstrating the rise in popularity in sites like Facebook and Twitter, some 11 percent of retailers said that social media was an effective acquisition tactic.

(Reuters photo)

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