Report: November E-Commerce Sales Reach $5.3B

Online consumer spending in the U.S. rose to US$5.3 billion in November, a 10 percent increase over 2000 levels, according to a report released Thursday by Nielsen//NetRatings (Nasdaq: NTRT) and Harris Interactive (Nasdaq: HPOL).

The growth rate was the smallest monthly increase recorded so far in 2001 by the eCommerce Pulse index, compiled by the two firms.

“The latest data indicate that the 2001 holiday season will achieve more modest gains than previously expected,” the two reported.

Pulling Back?

Nielsen//NetRatings had been predicting a $10 billion holiday season. Forrester Research (Nasdaq: FORR) has estimated that $11 billion will be spent. Both figures represent low double-digit growth for holiday e-commerce, which had enjoyed several years of dramatic expansion.

The slower growth in November came after two strong months helped fuel hopes for a banner holiday season, despite a sagging economy and lingering questions raised by the September 11th terrorist attacks and the ensuing war in Afghanistan.

September sales were up 54 percent over September 2000, while October saw a 25 percent increase over the year-earlier period.

It’s the Economy

Sales growth was also slower on a month-to-month basis. From October to November this year, sales rose 14 percent. Over the same period last year, they grew 29 percent.

When travel is removed from the picture, growth slows even more. Sean Kaldor, vice president of analytical services at NetRatings, said 42 percent of November’s growth came from travel sales.

“Travel has shown a gradual recovery from October, as consumers return to the skies,” Kaldor said.

Surprise Sectors

Meanwhile, the rest of the e-commerce marketplace is facing a harsher economic reality, NetRatings said. The index found slower-than-expected growth in several categories, including clothing and apparel, consumer electronics and toys.

Growing faster were health and beauty products, videos, and home and garden categories — all up more than 50 percent over 2000 levels.

“Although the overall industry growth rate is battling a tough economy, the spoils of growth are going to key market players,” said Kaldor. “With fewer merchants online than a year ago, those remaining will achieve growth rates much higher than the industry as a whole.”

The $5.3 billion spent online last month matches June’s spending levels, but signifies a drastic departure from earlier growth patterns. For instance, June spending this year increased 71 percent over 2000 levels, while sales for May were up more than 100 percent on a year-over-year basis.

Nielsen//NetRatings and Harris Interactive base their estimates of sales figures on a sample of 34,000 Web users.

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