August 15, 2011, 11:52 AM

Retail spending reports include encouraging signs for holiday e-retail sales

Tablets and smartphones, as well as the lure of discounts, could help web merchants.

Thad Rueter

Senior Editor

Lead Photo

Consumers continue to increase their retail spending, according to recently released figures, which is a good sign for e-commerce as online merchants gear up for the holiday shopping season. However, the reports cover the second quarter and July, before the recent wild swings in the stock market that may shake consumer confidence.

The National Retail Federation on Friday reported that retail spending increased 4% in July compared with the same month a year ago, thanks in part to promotions for school supplies, apparel and electronics; the figure excludes automobiles, gas stations, and restaurants. The numbers come in advance of Tuesday’s scheduled release of second quarter e-commerce spending figures from the U.S. Commerce Department, which last week reported that overall retail sales increased 6.5% in the second quarter compared with the same period a year earlier. (That figure includes autos, gasoline stations and restaurants, and the high price of gasoline likely contributed to the increase.) According to the most recent figures from web measurement firm comScore Inc., e-commerce spending jumped 14% in the second quarter compared with the same period in 2010.

“July retail sales make one important point clear—it’s very hard to ignore the resilience of the American consumer,” says NRF chief economist Jack Kleinhenz. “Retailers' promotions hit the right chord with back-to-school shoppers last month, helping ease concerns that consumers were pulling back on spending, which so far has been a driving force in the economic recovery.”

The new retail numbers come amid reports of spending gains for e-commerce. For instance, same-seller sales for retail clients of e-commerce services firm Mercent Corp. increased 17% in the second quarter compared with the same period a year ago, and about the same in July.

“Based on the sales performance of Mercent’s clients today relative to the major contraction of 2009, we believe e-commerce is positioned to perform well through the 2011 holiday,” says Eric Best, Mercent CEO.  “Online retailers’ operating efficiencies are increasing in marketing as well as fulfillment, and consumers are increasingly connected to e-commerce data and selection by virtue of tablets and mobile devices.”

Best adds that a soft economy during the third quarter of 2011 also could bring gains to online retailers as more consumers turn to the web in search of discounts, promotions and the best prices.

The recent NRF numbers are in line with growth rates for retail clients of ChannelAdvisor, which helps online merchants work with search engines, comparison shopping sites and online marketplaces, says CEO Scot Wingo. Though July comes between the graduation, Father’s Day and back-to-school shopping seasons, the month brought no signs of a spending retreat among online shoppers, he says. “Most categories were up for us in July, but those that performed exceptionally well included apparel, automotive, beauty and health, jewelry, pet supplies, toys and musical instruments,” he says.

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