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Apparel/Clothing, Computer Hardware/Peripherals and Consumer Electronics
Captured the Most Online Holiday Dollars This Year, Showing Double to
Triple-Digit Year-over-Year Growth; Record High in Shoppers Choosing to Buy
Online vs. Other Channels
ROCHESTER, N.Y. and NEW YORK, Dec. 29 /PRNewswire/ -- The Goldman, Sachs &
Co., Nielsen//NetRatings and Harris Interactive(R) fifth annual Holiday
eSpending Report revealed today that online holiday shopping totaled $30.1
billion, excluding travel, during the 2005 holiday season (October 29 -
December 23). This seasons online spending in the United States resulted in a
30 percent increase (+/- 3.1 percent margin of error) from the 2004 holiday
season.
"Consumers continue to shop later in the online holiday season as their
trust in on-time delivery grows. While 2005 holiday sales appear to be at the
high end of expectations, continued heightened competition could hurt
profitability," said Anthony Noto, Internet and entertainment analyst, Goldman
Sachs.
According to the final Holiday eSpending Report for 2005, online shoppers
spent the most holiday dollars on apparel/clothing during the 2005 holiday
season, totaling $5.3 billion; the category enjoyed 42 percent growth from
last years online revenue (see Table 1). Computer hardware/peripherals ranked
second in category spending with a total of $4.8 billion, showing a 126
percent year-over-year growth in online revenue, the strongest growth this
season.
Consumer electronics, the second fastest growing category, garnered $4.8
billion in online spending, jumping 109 percent year-over-year. Books and
toys/video games rounded out the top five product categories, garnering $3.0
and $2.3 billion in online revenue, respectively. The Books category jumped 66
percent in revenue from last year, compared to toys/video games, which fell
nine percent from the 2004 holiday season.
"Apparel remains one of the more dominant product categories during the
holiday season, mirroring offline holiday retail behavior," said Heather
Dougherty, senior retail analyst, Nielsen//NetRatings. "Computer hardware and
consumer electronics had a stellar season with the price reductions for
laptops, plasma TVs, color printers as well as high demand for iPods, digital
cameras, and media accessories. The 2005 holiday season was a gadget year for
consumers of all ages, and consumers continued to show their love for free
shipping."
Dougherty continued, "Toys and video games were not as fortunate this
year, with a lack of the must-have toy to drive sales. Moreover, the line
between product categories are blurring with the introduction of more hybrid
devices that can be considered consumer electronics or computer hardware."
Table 1: Online Shopping Categories Ranked by Projected Online Revenue,
December 2005
Product Category** 2005 Projected Online 2005 vs. 2004 YOY
Holiday Revenue in Growth
Millions
Apparel/Clothing $5,349 42%
Computer hardware/peripherals $4,821 126%
Consumer electronics $4,793 109%
Books $2,953 66%
Toys/Video games (hardware
& software) $2,296 -9%
Source: Goldman, Sachs, Nielsen//NetRatings, and Harris Interactive
eSpending Report, December 2005; the Holiday eSpending Report considers
October 29 to December 23, 2005 as the 2005 holiday season.
* Note: Number of respondents: More than 1,000 online U.S. adult
consumers surveyed weekly (Week 1-8: n=8,676)
** Note: The featured categories met a minimum reporting sample of 100
respondents.
Shifts in Online Holiday Shopping Behavior
During the 2005 holiday season, the fifth annual Holiday eSpending Report
surveyed more than 1,000 consumers a week to capture consumer spending habits,
attitudes and motivations, totaling more than 8,600 shoppers throughout the
season. Through the course of the last few years, consumers have been asked to
break down their holiday budget amongst various sales channels.
While traditional brick-and-mortar stores continued to hold the majority,
or 68 percent of the 2005 holiday spending, it dropped 10 percentage points
from the 2002 holiday season, when consumers said they intended to conduct 78
percent of their holiday spending in stores.
In contrast, the online sales channel rose 11 percentage points, garnering
27 percent of total budgets this year from 16 percent four years ago. Catalog
buying remained steady at five percent this year, compared to six percent in
2002.
"E-commerce is gaining ground amongst consumers during the holiday season
due to its convenience, product selection and lower prices. Most importantly,
holiday shoppers are diligent about finding the best price. The continued
popularity of search engines, such as Google and Yahoo!, highlights the ease
of researching product selection and availability, and with a longer shopping
season, it was much easier to wait for additional price reductions," continued
Dougherty.
Table 2: Distribution of Holiday Spending, Aggregated Seasonal Average,
December 2005
Spending
Distribution 2005 2004 2003 2002 2002 vs. 2005 Change
Stores 68% 72% 74% 78% -10%
Catalogs 5% 6% 6% 6% -1%
Online 27% 22% 20% 16% 11%
Source: Goldman, Sachs, Nielsen//NetRatings, and Harris Interactive
eSpending Report, December 2005
* Note: Number of respondents: More than 1,000 online U.S. adult consumers
surveyed weekly (Week 1-8: n=8,676)
This holiday season, consumer satisfaction reached a peak with 64 percent
of shoppers noting they felt very or somewhat satisfied (see Table 3).
Consumer dissatisfaction hit a four-year low as only six percent of consumers
cited they were either very dissatisfied or somewhat dissatisfied.
Dougherty added, "The consistently high level of satisfaction each year
increases the future expectations for online sales. More consumers are taking
advantage of the benefits of e-commerce to avoid holiday crowds and purchase
competitively priced gifts. Many of the free shipping promotions help level
the playing field among the sales channels, which elevates satisfaction
amongst online shoppers."
Table 3: Consumer Satisfaction, Aggregated Seasonal Average, December 2005
Satisfaction
Level 2005 2004 2003 2002 2002 vs. 2005 Change
Very satisfied 40% 37% 40% 37% 3%
Somewhat satisfied 24% 24% 23% 22% 2%
Neutral 31% 32% 30% 33% -3%
Somewhat dissatisfied 4% 5% 5% 5% -1%
Very dissatisfied 2% 3% 3% 3% -1%
Source: Goldman, Sachs, Nielsen//NetRatings, and Harris Interactive
eSpending Report, December 2005
* Note: Number of respondents: More than 1,000 online U.S. adult consumers
surveyed weekly (Week 1-8: n=8,676)
About the 2005 Holiday eSpending Report
The eSpending Report by Goldman Sachs, Nielsen//NetRatings and Harris
Interactive is based on a weekly national survey of more than 1,000 adult
consumers from among the Harris Interactive online panel of survey respondents
who are randomly invited to participate in online surveys. The survey began to
field the week of October 29. The week 8 data are based on responses from a
sample of 1,153 U.S. adults who were online, fielded from December 17-23,
2005; totaling, over 8,600 consumers who have been surveyed during the 2005
holiday season. The 2005 holiday season data were weighted to be
representative of the total U.S. online population of adults, and in theory,
with a probability sample of this size, one can say with 95 percent certainty
that the overall results have a sampling error of +/-3.1 percentage points.
Sampling error for sub-category results is higher and varies. The eSpending
Report offers weekly intelligence on online shopping and spending by market
segment and also tracks consumer attitudes and motivations that drive online
shopping.
About Goldman Sachs
Goldman Sachs is a leading global investment banking, securities and
investment management firm that provides a wide range of services worldwide to
a substantial and diversified client base that includes corporations,
financial institutions, governments and high net worth individuals. Founded
in 1869, it is one of the oldest and largest investment banking firms. The
firm is headquartered in New York and maintains offices in London, Frankfurt,
Tokyo, Hong Kong and other major financial centers around the world.
About Nielsen//NetRatings
NetRatings, Inc. (Nasdaq: NTRT) delivers leading Internet media and market
research solutions, marketed globally under the Nielsen//NetRatings brand.
With high quality, technology-driven products and services,
Nielsen//NetRatings is the global standard for Internet audience measurement
and premier source for online advertising intelligence, enabling clients to
make informed business decisions regarding their Internet and digital
strategies. The Nielsen//NetRatings portfolio includes panel-based and
site-centric Internet audience measurement services, online advertising
intelligence, user lifestyle and demographic data, e-commerce and transaction
metrics, and custom data, research and analysis. For more information, please
visit http://www.nielsen-netratings.com.
About Harris Interactive(R)
Harris Interactive Inc. (http://www.harrisinteractive.com), based in
Rochester, New York, is the 13th largest and the fastest-growing market
research firm in the world, most widely known for The Harris Poll(R) and for
its pioneering leadership in the online market research industry. Long
recognized by its clients for delivering insights that enable confident
business decisions, the Company blends the science of innovative research with
the art of strategic consulting to deliver knowledge that leads to measurable
and enduring value.
Harris Interactive serves clients worldwide through its United States,
Europe (http://www.harrisinteractive.com/europe) and Asia offices, its
wholly-owned subsidiary Novatris in Paris, France (http://www.novatris.com),
and through an independent global network of affiliate market research
companies. EOE M/F/D/V
To become a member of the Harris Poll Online(SM) and be invited to
participate in future online surveys, go to http://www.harrispollonline.com
Press Contacts:
Harris Interactive
Nancy Wong
(585) 214-7316
nwong@harrisinteractive.com
Goldman Sachs
Ed Canaday
(212) 357-0005
ed.canaday@gs.com
Nielsen//NetRatings
Tracy Yen
(408) 941-2932
tyen@netratings.com
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