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E-commerce continues to attract consumers, but they may be spending less individually.
E-commerce continues to make gains among U.S. consumers, but as e-retailers prepare for the holiday season, there are fresh signs that shoppers are spending less.
Second quarter sales increased 30% compared with the same period last year for retailer clients of Channel Intelligence Inc., which sells e-commerce and online marketing technology and services. The figure is based on the online shopping activity for hundreds of retailers, Channel Intelligence says.
But Channel Intelligence also reports a 15% year-over-year decrease in average sales price per order, based on an analysis of data from the firm’s largest retail clients. Channel Intelligence provided no specific figures or names, but the company’s clients include some of the largest names in retailing, such as national retail chains Sears Holdings Corp., J.C. Penney Co. Inc., Target Corp. and Best Buy Co. Inc. Sears is No. 7 in the Internet Retailer Top 500 Guide, J.C. Penney is No. 20, Target No. 22 and Best Buy No. 11.
"Our analysis tells us consumer confidence may still be weak, because price seems to be a major consideration right now for online shoppers." says Rob Wight, CEO of Channel Intelligence. "The good news is that consumers are spending. But it is worth noting that they are buying less expensive items. This might be an indicator of what spending habits will be like during the holiday season."
Other data point to the increasing popularity of online shopping even as the economy—as shown in recent weeks by stock market cliff-jumping—could be about to enter a rougher patch.
The number of U.S. online purchases in the second quarter hit 539 million, up 22.5% from 440 million in the same period last year, according to data from comScore Inc. The web measurement firm tells Internet Retailer that the average number of transactions per buyer increased 6.7% in the second quarter, to 3.2 from 3.0. Those increases coincide with a 14% rise in Q2 online retail sales, to $38 million from $33 million a year earlier, comScore says.
The bad news, however, is that consumers spent less per transaction, resulting in a 6.7% drop in Q2 average order value, to $70 from $75, comScore says.
Still, Wight says data from Channel Intelligence’s clients reveal an accelerating shift from offline to online shopping. He says that Channel Intelligence clients as a whole experienced a 51% year-over-year increase in the number of Q2 online orders, and that clients using the company’s CI Product Search online marketing service saw a 63% year-over-year increase in Q2 conversion rates. CI Product Search lets the company’s clients place search ads with product images on the Bing and Google search engines.