By: Tessa Rudd

“Are you an online or in-store shopper?”

It’s been just days since Christmas and MSN is already harping on the “economic gloom and doom” of 2007’s holiday shopping season. Similarly, The Washington Post recently carried the morose headline “Holiday Spending Growth at a 5-Year Low”. A major—and missing—facet in MSN and The Washington Post’s economical narrative is the analogously reported increase in online shopping and the success of e-commerce this holiday season. Michael McNamara, Vice President for Research and Analysis at MasterCard Advisors, announced, “online shoppers led the growth in spending, with internet sales gaining 22 percent from Nov. 23 through Dec. 24.” Forbes.com, Nielsen Online, Time Warner, and BizReports concurrently announced this success for e-commerce; all sources citing ‘convenience’ as being the dominant factor driving online holiday shopping. Forbes.com’s report on “EBay’s Holiday Season Success,” included a statement from eBay’s Dean of Education, Jim Griffith, describing that “internet shopping has become increasingly convenient and consumers are more comfortable than ever buying products on the Web. Thus, shoppers are more likely to shop online for their holiday needs.”  Nielsen Online further analyzes this determined online shopping ‘convenience’ in a recent News Release, breaking the appeal into four subcategories; the ability to shop anytime during the day, the ability to comparison shop, the ability to find products easily, and saving time. Examining their online partner AOL, Time Warner reported that “ninety-five percent of AOL shoppers find online shopping easier and more convenient because the cyberstores are always open…The most popular time to shop on AOL is the “prime-time” usage hours of 8:00 p.m to 10 p.m.” 

As AOL’s data explicitly indicates, with one third of shopping channel traffic occurring during this evening prime-time, a time in which ‘brick and mortar’ stores are closed, e-commerce can only outshine off-line shopping. BizReport attributes the overall online shopping experience as being the chief factor enticing shoppers to the Web. Barbara Staid, President of Safe Home Products explains in this December 2007 BizReport that shoppers go online for, “research purposes,” and, “using consumer shopping engines or on-site sections with consumer reviews is a good idea.” Hat’s off to a great holiday season e-commerce!

But with the new year fast approaching, what’s ‘in store’ for 2008 when it comes to online shopping? E-Commerce revenues have climbed considerably and consistently over the years. This is thanks to an ever-expanding e-marketplace of e-tailers all made possible by improved technological utility and an increasing number of online shoppers. I contend that this trend will continue. CIBC World Markets analyst Malindi Davies affirms a bright future for e-commerce, indicating, “improvements in customer experience across the e-commerce landscape should ‘spur the ongoing secular shift to online retail spend,’” adding “that under current macroeconomic conditions e-commerce companies may see some margin pressure as competition increases,” (Forbes.com, 11.27.07). BizReport’s findings that shoppers turn online for “research purposes,” namely the ability to compare one product to another, add meat to Davie’s projections for the future of e-commerce; increased competition of retailers means shoppers have the ability to research and make informed and individually customized buying decisions.

E-commerce offers a quintessential platform for comparative, research-based shopping. Chitika’s ad units emulate this shopping model, enabling comparative shopping through our interactive product search engines as well as with our multi-product ad units. Competition is certainly crucial in any marketplace. The future for online shopping—in 2008 and beyond—is bright and shines through MSN’s reported “economical gloom and doom”. Increased e-competition in e-commerce will yield continued e-prosperity!

By Tessa Rudd – Account Executive – Advertising Media Division, Chitika Inc.