In its second-largest acquisition, Amazon buys the company for $970 million.
Fears that online merchants will lack enough stock or deliver goods too late are expected to drive about half oft Web shoppers to spend less than 10% of their holiday budgets online, according to (www.jup.com) Jupiter Communications Inc. These fears will drive many of the 20 million online holiday shoppers-20% of the online population, to favor merchants from whom they bought in the past.
Jupiter surveyed more than 1,300 U.S. online shoppers in late November and found that most plan to be conservative in shifting their holiday spending online. "We expect that consumers are going to spend around $6 billion this holiday season, representing significant growth over previous years, but we need to put this in perspective. The amount is still only a small percentage of what they expect to spend over the holiday season," says Fiona Swerdlow, senior analyst with and director of Jupiter's digital commerce strategies practice. "Consumers are risk-averse to gambling with the success of their holiday shopping."
Of those surveyed, about half say site recognition and trust are keys to selecting an online merchant, 39% plan to buy from online merchants whose stores or catalogs they have used offline, and 37% plan to buy from merchants from whom they bought online in the past.
"Established merchants could lose the holiday battle," says Ken Cassar, analyst with Jupiter's digital commerce strategies practice. "Their greatest challenge is living up to the expectations that consumers have toward their brands. Nailing the basics such as site performance, inventory, fulfillment management, and customer service becomes more crucial than ever."