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Nov 23, 2007
US online retail sales could grow around 20%
Segment looking buoyant compared to rest of industry
STAYING STRONG: While growth in online holiday sales is set to dip from last year's 25 per cent rate, it should still be much better than the low single-digit rate forecast for the overall retail sector. -- PHOTO: AFP
WASHINGTON - ONLINE retail sales are expected to be a bright spot in an otherwise gloomy holiday picture for e-commerce firms, despite a host of worries for American consumers, analysts say.

Surveys indicate online sales for the critical holiday season will grow by 15 to 20 per cent.

While Christmas shopping in the bricks-and-mortar world swings into high gear in the United States on 'Black Friday' today, the day after Thanksgiving, online sales usually reach a frenzy on Cyber Monday, when Americans return to work and shop - from their office computers.

Research firm eMarketer predicts that online holiday sales will reach US$31 billion (S$44.9 billion) this season, up 18.5 per cent over last year.

'It's true that this year's growth rate will be a drop-off from last year's growth of 25 per cent,' says Mr Jeffrey Grau, an eMarketer analyst. 'But it is far superior to the low single-digit growth rate forecast for the overall retail industry this holiday season.'

A separate survey by research firm comScore said online sales for the holiday season, which started early this month, are running 17 per cent ahead of last year's pace, based on data up till last Sunday.

Forrester Research is expecting US online retail sales this holiday season to reach US$33 billion, a 21 per cent rise over last year. But the company's survey says many shoppers are hooked on free shipping offers and few are willing to pay for frills such as gift wrapping or overnight delivery.

Forrester says Europeans will outspend Americans online for the holidays, forking out US$51 billion, amid increased confidence in Internet sales.

In the US, around 42 per cent of adults will shop online this year for the holidays, up from 40 per cent a year ago, according to a Consumer Reports survey.

About 48 per cent of those surveyed cited the convenience of shopping online; others wanted to avoid crowds, find a better selection or get lower prices.

'Though more than half of US homes have high-speed access, many Americans feel the best place to shop for online gifts is not at the mall, but at the office,' says the National Retail Federation.

The organisation says 72 per cent of online retailers will feature special promotions for Cyber Monday that may include big discounts or free shipping.

'As more people rely on the Internet for holiday shopping, retailers have stepped up their game to compete,' said Mr Scott Silverman, an executive director of Shop.org, the retail federation's e-commerce arm.

AGENCE FRANCE-PRESSE

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