E-Commerce Developments

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E-tailers to focus on social media this holiday

Free shipping also a priority

October 23, 2009

Washington--Online retailers will emphasize social media and free shipping this holiday season in an effort to encourage uncertain shoppers to spend, a new survey shows.

According to the results of the eHoliday Study, conducted by Big Research for Shop.org, a division of the National Retail Federation, 47.1 percent of online retailers surveyed plan to increase their use of social media this holiday season.

More than half of online retailers (60.3 percent) said they have added a Facebook page or improved their existing page, and 58.7 percent said the same for Twitter.

Two-thirds (65.6 percent) have added or enhanced blogs and RSS feeds.

In addition, according to the survey, one-third of online retailers (34.3 percent) said they would offer holiday deals earlier this year.

In another sign of the times, four out of five online retailers (79.4 percent) will offer free shipping with conditions--meaning that consumers must purchase a certain item or spend a certain amount of money to qualify--at some point during the holiday season.

The survey also showed that 57.4 percent of online retailers plan to offer free shipping without conditions, 35.7 percent said their budgets for free shipping are higher this year than last and 30 percent said free shipping offers would start earlier in the year.

"Retailers know that times are tough, so they have created promotions and incentives to help Americans save money this holiday season," Shop.org Executive Director Scott Silverman said in a release announcing the survey results. "From free shipping to Facebook, online retailers are combining new initiatives with tried-and-true tactics to make their companies stand out."

In addition to free shipping and improved social media, many online retailers have revamped their Web sites ahead of the holiday season, adding or improving their sites' shopping cart (45.2 percent), search capabilities (44.3 percent), suggested items (42.9 percent), customer ratings and reviews (40.6 percent) and featured sale pages (37.1 percent).

While online growth is expected to slow this holiday season, it's still a bright spot in retail.

According to the survey, 45.8 percent of online retailers expect their holiday sales to increase at least 15 percent over last year, while one-third (33.9 percent) expect sales to grow up to 14 percent.

One in five e-tailers (20.3 percent) expect sales to be flat or to decline.

On the consumer side, the survey shows that 26.7 percent of online shoppers said they plan to spend a larger portion of their holiday budget online this year, mainly because the Internet allows them to shop at all hours of the day (41.9 percent) and because it's easier to compare prices (34 percent).

The small percentage of people (5.7 percent) who plan to spend less of their holiday budget online said that they'll pull back because of expensive shipping charges (22.8 percent), because they like to handle items before they buy (12.5 percent) or because they prefer the store experience (10.8 percent).

When it comes time to pony up for their holiday purchases, 67.3 percent of those surveyed said they will use a credit card for some purchases, though 35.6 percent will also use a debit card and PayPal (33.9 percent) for purchases.

In addition, 11.5 percent of online shoppers will use a gift certificate or gift card.
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