As expected, online retail growth fell for the first time since 2001, when ComScore started tracking it. Growth fell 4% in so far in November. ComScore predicts flat growth for the holiday season, compared to last year. “Despite the recent reprieve that plummeting gas prices have given American consumers, the depressed and volatile stock market, declining housing prices, inflation and the weak job market all represent dark clouds hanging over their heads this holiday shopping season,” said comScore chairman, Gian Fulgoni.
“With consumer confidence low and disposable income tight, the first weeks of November have been very disappointing, with online retail spending declining versus year ago. It’s also likely that some budget-conscious consumers are planning to wait to buy until later in the season to take advantage of retailers’ even more aggressive discounting.”
ComScore predicts $29.2 billion for this year’s holiday season, the same as last year’s. ComScore also reports that almost half of respondents to its new Holiday Shopping Survey will be buying fewer gifts (47%) or less expensive ones (46%).
Online advertising is also slowing and will fall into single digits for the first time in 2009.
$23.6 billion dollars will be spent in online advertising this year, and eMarketer expects only $2.2 billion in growth for 2009. How much have times changed, these last few months? In August, eMarketer projected 14.5 percent growth for 2009, now it only 8.9%.