Strong, But Slower, Growth in Online Sales


OnlineSalesGrowthGraph.gif   Source of graph:  online version of the NYT article cited below.


(p. 1)  SAN FRANCISCO, June 16 — Has online retailing entered the Dot Calm era?

Since the inception of the Web, online commerce has enjoyed hypergrowth, with annual sales increasing more than 25 percent over all, and far more rapidly in many categories. But in the last year, growth has slowed sharply in major sectors like books, tickets and office supplies.

Growth in online sales has also dropped dramatically in diverse categories like health and beauty products, computer peripherals and pet supplies. Analysts say it is a turning point and growth will continue to slow through the decade.

. . .

Forrester Research, a market research company, projects that online book sales will rise 11 percent this (p. 16) year, compared with nearly 40 percent last year. Apparel sales, which increased 61 percent last year, are expected to slow to 21 percent. And sales of pet supplies are on pace to rise 30 percent this year after climbing 81 percent last year.

Growth rates for online sales are slowing down in numerous other segments as well, including appliances, sporting goods, auto parts, computer peripherals, and even music and videos. Forrester says that sales growth is pulling back in 18 of the 24 categories it measures.

. . .

The turning point comes as most adult Americans, and many of their children, are already shopping online.  That means Internet stores are not getting a flurry of new shoppers to spur the kind of growth tht the industry is accustomed to.  There is a boom in the number of foreigners coming online, but shipping items overseas can limit that market as a source of growth. 

. . .

John Morgan, an economics professor from the Haas School of Business at the University of California, Berkeley, said he expected online commerce to continue to increase, partly because it remains less than 1 percent of the overall economy.  “There’s still a lot of head room for people to grow,” he said.


For the full story, see: 

MATT RICHTEL and BOB TEDESCHI. "As Some Grow Weary of Web, Online Sales Lose Momentum."  The New York Times, Section 1  (Sun., June 17, 2007):  1 & 16. 

(Note:  ellipses were added.  The online version of the article had the slightlly different title:  "Online Sales Lose Steam as Buyers Grow Web-Weary."  The bold has been added to indicate a couple of sentences in the above excerpts, that were in the print version, but had been dropped from the online version.)


    Source of graph:  online version of the NYT article cited above.


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