Online Shopping to Plateau As Slump Hits Cyberspace

CHRISTOPHER LAWTON
The Wall Street Journal
November 26, 2008

Nobody was expecting online shopping to be immune from the economic downturn, but most forecasts had been calling for at least a smidgen of growth. Now, even that hope is damped.

• A d v e r t i s e m e n t

For the first 23 days of November, online sales declined 4% to $8.2 billion from $8.5 billion the same time last year, according to market-research firm comScore Inc. The firm projects that retail spending online in the months of November and December will total $29.2 billion, flat from the same period last year — a dreary sign for online retailers, many of which had grown accustomed to double-digit gains.

The figures follow numbers from October, when online sales rose only 1% compared with a year earlier.

“The decline that we’re seeing is unprecedented,” said Andrew Lipsman, a senior manager at comScore.

ComScore attributed the sales slowdown to factors including the volatile stock market and weak job market.

Holding out hope, Mr. Lipsman said that last year comScore saw consumers wait until later in the season to begin their holiday shopping online, in the hope of scoring better offers and deals.That could be a saving grace if the same thing happens this year.

“I think we can expect their spending will pick up as we get later into the season. That said, to expect there is going to be strong growth or even very positive growth at this moment in time seems optimistic,” Mr. Lipsman cautioned.

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