Online Sales Soared 48 Percent to $76 Billion in 2002
According to The State of Retailing Online 6.0, a Shop.org annual study conducted by Forrester Research of more than 130 retailers, online retail sales soared to $76 billion in 2002, up 48 percent over 2001. Shop.org is the online retailing division of the National Retail Federation. The study also show that 70 percent of retailers reported positive operating margins, compared with 56 percent in 2001. Online retail sales are expected to grow 26 percent in 2003 to $96 billion, with seven product categories poised for more than 40 percent growth in 2003. Last year, 32 percent of computer hardware and software was sold online. Other categories reaching double-digit penetration include tickets for events (17 percent) and books (12 percent). In total, nine categories will exceed 5 percent penetration this year compared with seven categories in 2002. Online sales are expected to reach 4.5 percent of total retail sales in 2003, up from 3.6 percent in 2002. The study also showed that 40 percent of online customers are completely new to a retailer’s entire business. By shifting budgets away from expensive portal deals to performance-based affiliate marketing and search engine marketing, retailers were able to cut marketing costs almost in half per order placed ($12 to $8), with store-based ($5) and catalog-based ($7) retailers most successful in this endeavor.
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