RSS
Online Retail Sales To Rise in 2008
By Reshma Kumar at April 09, 2008 0 CommentsIn spite of the slowing economy, online retail sales is expected to rise 16.6% in 2008 to $204B in line with 2007 growth rate according to Forrester Research. Nearly all retail categories are expected to be beneficiaries but the biggest online beneficiaries are apparel which is expected to rise by $3.9 billion, or 17%, computers up $3.2 billion, or 15%, and autos up $2.5 billion, or 15%. Of course, although e-tailing is gaining in popularity, it still accounts for less than 5% of the overall retail market in the U.S. And, they are not necessarily new stores but sale transfers from bricks-and-mortar stores.
Forrester expects that retailers will focus their online marketing dollars in paid search and email where efficacy can be more easily tracked. The Forrester report estimates that the “average online retailer spends $300,000 annually to send 77 emails a year to each customer. That works out to an average cost of $7 per order”. Search engine marketing costs about $0.50 per click which is about $8.47 per click in revenue.
On the consumer side, this is being attrubuted to the convenience of online shopping and high gas prices. For companies, the overall slowing economy is forcing companies to cutback and streamline their ad spend.
Labels: Online Advertising, Search Engine Marketing
