No Visions of Sugarplums
Some coolness in the brick and mortar retail world this holiday season has been attributed to expected growth in the online retail world. However, the early evidence of holiday online traffic is not that encouraging with a few execeptions. In most cases we see a significant erosion in online reach (unique shoppers per million online users) with the exception of BUY.COM (unfortunately went private in November 2001). We suspect BUY.COM is succeeding thanks to effective email based marketing campaign and online video product reviews (especially user videos).
A sampling (TARGET CORP [TGT], OVERSTOCK.COM [OSTK], BUY.COM, and AMAZON.COM INC [AMZN]) of the online traffic patterns using a “Reach” metric for the past 3 years, as available through Alexa, follows.
Note that increasing transaction prices will soften the impact, but on balance, the holiday season does not seem to be encouraging for the online retail world.
