January 18, 2007, 12:00 AM

Offline sales influenced by online research to hit $1 trillion

Offline retail sales influenced by consumers’ online browsing and research will increase 12% over the next five years, says JupiterResearch. The healthy growth of offline-influenced sales will reach 40% of total U.S. retail sales by 2011, it says.

Kurt Peters

Executive Editor

 

Offline retail sales influenced by consumers’ online browsing and research will increase by a compounded annual growth rate of 12% over the next five years, says JupiterResearch. According to the research and consulting firm’s new report, “U.S. Online Retail Forecast, 2006–2011,” the healthy growth of offline-influenced sales will reach 40% of total U.S. retail sales, or $1 trillion, by 2011.

“Online retail sales are maturing and the lion’s share of future growth will primarily come from existing buyers spending more in the online channel,” says Patti Freeman Evans, JupiterResearch senior analyst and lead author of the report. “Assuming growth continues in a similar trajectory over the coming decades, U.S. online retail sales will plateau at 10% to 15% of total U.S. retail sales, barring a dramatic change in the online shopping experience that promotes an inordinate spending shift among buyers.”

U.S. online retail sales will grow by 16% in 2007 to reach $116 billion, according to JupiterResearch. This growth rate is less than the consistent rate of 25% during the last few years, according to numerous reports by other firms. Over the next five years U.S. online retail sales will grow at a compounded annual growth rate of 11%, reaching $171 billion in 2011, Jupiter projects. Despite the slowing of growth in online buying, web-influenced offline sales will grow at a faster pace over the next five years, reinforcing the vast advertising and marketing value retail web sites present, the report says.

“With market maturation comes opportunity for retailers that can harness the power of the Internet to influence offline sales,” says David Schatsky, president of JupiterKagan Inc., JupiterResearch’s parent. “The key for retailers is to create clear, simple and convenient links to offline channels that persuade shoppers to stay with them as they cross channels.”

Freeman Evans will speak at the Internet Retailer Conference & Exhibition, June 4-7 in San Jose in a session entitled Using Customer Product Reviews to Attract Loyal Shoppers.

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