Net Sales See September Slide

E-commerce customer spending fell 12.8 percent from August to September, according to a new report published by U.S. Bancorp Piper Jaffray and Harris Interactive.

The research revealed an online sales drop-off from $120 (US$) per customer (median) in August 2000 to $100 per customer in September, during which consumers conducted an estimated $3.09 billion of commerce online. Year-to-date e-commerce sales were estimated at $25.9 billion.

“The decline was primarily due to a lower transaction value,” Tony Gikas, senior e-consumer analyst for U.S. Bancorp Piper Jaffray, told the E-Commerce Times. “During the month the number of online shoppers and buyers was actually up, but the median purchase amount was down 16.7 percent. There was potentially less time spent making purchases and fewer big ticket purchases, such as in the travel sector, and traffic is generally softer this time of year.”

Computer Industry Slammed

Nearly every vertical market experienced a decline in customer spending during September. The computer industry was hit hardest, with the computer hardware/peripherals market falling 39.1 percent and the computer software category witnessing a 32.7 percent plunge in customer expenditures.

Only the toy and sporting equipment industries were spared, as online customer spending for toys rose 9.7 percent, and sporting goods increased 2.4 percent. The travel services category, the largest market, was down $148 million from the previous month.

Industry bellwether Amazon.com was especially vulnerable, as sales of online books fell approximately 28 percent, video sales 26 percent, and music sales 22 percent.

“We believe the softness in the books and music and videos segments may limit Amazon’s quarterly earnings upside, as approximately 75 to 80 percent of Amazon’s revenues are derived from sales in these vertical markets,” said Gikas, who added that he expects these markets, as well as computers, to pick up as the holiday season approaches.

No Satisfaction

The report also measured customer satisfaction levels for the month of September, which remained essentially steady when compared to the previous month. The average e-commerce site received an overall satisfaction rating of 7.95 (out of 10) in September, roughly equal to the 7.98 average recorded in August.

Of the 13 companies measured for customer satisfaction, Amazon gained the highest marks with a September rating of 8.51. America Online (AOL) and Priceline.com rounded out the bottom of the satisfaction rankings, with marks of 7.14 and 7.24 respectively.

Customer Comes First

“I truly believe e-commerce is becoming more about customer satisfaction,” Gikas said. “It’s about companies giving customers what they need in terms of actual buying experiences in relation to company inventory, how many products are in stock, when will the product ship, making returns easier, etc. A year ago many e-commerce companies didn’t have the technology to do these types of things, now many of them do.”

U.S. Bancorp Piper Jaffray, a subsidiary of Minneapolis, Minnesota-based U.S. Bancorp, provides investment products and services to businesses, institutions and individuals.

Leave a Comment

Please sign in to post or reply to a comment. New users create a free account.

E-commerce Times Channels