Web Sales Beating Expectations

Monday, 18 Dec 2006 | 11:29 AM ET

Surprise package: online sales were expected to be big this year -- but some observers have been bowled over by just how big.

CNBC’s Michelle Caruso-Cabrera said that holiday shopping on the Web has reached $20 billion so far, up from the $16 billion amassed over the same period last year.

Online Spending Surge
Online retail sales are surging late into the holiday season, and the latest snapshot shows a 25% increase compared to last year's sales. Gian Fulgoni, Comscore Networks Chmn; Patti Freeman, Jupiter Research Sr. Retail Analyst; and CNBC's Michelle Caruso-Cabrera discuss what's fueling the surge.

Patti Freeman Evans, senior retail analyst at Jupiter Research, attributes the boom to more product offerings, aggressive marketing – and to many more Internet retailers offering on-time delivery guarantees.

Gian Fulgoni, chairman of Web-business tracker comScore, agrees. He told “Morning Call” that e-commerce trailblazer Amazon.com is No. 1 in terms of absolute sales – but says growth rates tell a different story. By the latter metric, brick-and-mortar retailers are surpassing pure-play cyber firms, with Best Buy, Circuit City Stores and Wal-Mart building their online sales presence at twice the rate of companies like Amazon and eBay.

Fulgoni also points an advantage that the brick stores have: they allow shoppers to buy online – and then go pick up the merchandise at the store, guaranteeing peace of mind.

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