Posted by: Catherine Holahan on July 25, 2008
Research firm eMarketer has some good news for online retailers: high gas prices are fueling more Web shopping. In a July 25 report senior analyst Jeffrey Grau points to several consumer polls showing more shoppers are opting to spend online and save at the pump.
In a June survey, Nielsen found that 11% of US consumers are shopping more online as the result of gas prices. The poll mirrors reports of declining foot traffic at retail stores. “For the first time, I am seeing consumer surveys in which saving money on gas prices is actually a reason given for moving shopping from stores to the Internet,” says Grau.
However, higher gas prices and the general US economic downturn are doing more bad than good for online retailers. US e-commerce growth has slowed over the years as online shopping has become more common. This year, the slowdown accelerated. E-Marketer predicts that the US e-commerce market will grow 14.3% this year. That’s down from 19.8% growth in 2007 from the prior year, and 22% growth in 2006.
Online giant eBay has suffered from this trend. Though the company saw more shopping activity on its site during the last three months, consumers spent fewer dollars. The number of items sold was up 10% from the prior year. But the average selling price of items decreased 6%, resulting in significantly slower growth in the company’s shopping business.
“Consumers may be shifting more of their spending online, but their wallet or pocketbook may be smaller,” says Grau