Online holiday shopping to grow 15% year on year

Groupon - 'Epic deals'

Holiday e-shopping sales will grow 15% year on year from USD50bn in 2010 to hit USD59.5bn in 2011, according to the latest report from Forrester, driven by demand for online coupons and the wider growth of mobile payments. The forecast coincides with news that daily deals titan Groupon is planning to build on last year’s holiday sales strategy with a new raft of ‘Epic deals’ and national deals to supplement its core local offers business. Nearly half of those polled say that they find better deals on line, while 58% says that they are increasingly price conscious, which may allay fears that demand for daily deals is waning. Forrester analyst Sucharita Mulpuru cites the “proliferation of consumer touchpoints that give buyers more access to the web,” as a major factor in driving growth.

The report is in line with forecasts that mobile will account for a growing percentage of e-shopping, as consumers increasingly turn to tablets and smartphones to make their purchases. According to Forrester, half of tablet owners and 30% of smartphone owners surveyed look up goods on their devices at least once a month.

Forrester claims that 12% of holiday sales growth will come from increased spending per individual consumer, as opposed to larger numbers of consumers coming into the e-shopping space. Although Thanksgiving, Black Friday and Christmas all make the quarter spanning November and December a lucrative month for all retailers, the growth of mobile shopping over the past year is expected to drive record sales. As consumers increasingly turn to mobile devices, online retailers are moving to meet them halfway, scrambling to improve their mobile offerings in a bid to pull in customers. eBay is planning to launch a 25-day deal programme, with daily flash sales and online discounts. The firm has told TechCrunch that it expected purchases made on mobile devices to contribute significantly to a forecast USD5bn gross sales this year.

Comparative newcomer Groupon is also attempting to take advantage of the holiday boom in spending. The firm “learned a lot from last year”, says head of gifting Aaron Cooper, now looking to reassure investors over its value after a USD700m IPO earlier this month. Although Groupon notched up a USD12.7bn valuation on its public debut, the firm is under pressure to perform well amid concerns over its accounting and long-term business model. It is now building on last year’s seasonal shopping push, Grouponicus, rolling out to 41 states in the US and Canada, rather than 15. In a departure from small local deals, Groupon has struck a deal with fashion retailer American Apparel to offer national deals on clothes, as well as Epic Deals, such as a round-the-world trip.

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