SOURCE: eMarketer

April 19, 2005 09:54 ET

U.S. E-Commerce Growth to Significantly Outpace Total Retail Spending

NEW YORK, NY -- (MARKET WIRE) -- April 19, 2005 -- U.S. e-commerce revenues jumped more than 25% last year, and annual gains look to continue to run in the healthy double-digit range through 2008, according to eMarketer estimates.

Long gone are the days when Web sites crashed and online retailers burned through investors' money. Today, Internet retailers offer a stable shopping environment, and many of them are enjoying a healthy profit margin. At the same time, Internet users are becoming more sophisticated in utilizing multiple shopping channels to research and buy products.

eMarketer's new report, E-Commerce in the U.S.: Retail Trends, released today, estimates that U.S. consumers will spend $84.5 billion online this year for retail goods and services, and that number will grow to $139 billion by 2008. This expected growth in U.S. e-commerce will significantly outpace total retail spending over the next four years.

"Online shoppers are certainly responding to more sophisticated sites, and better-targeted marketing efforts," said eMarketer Senior Analyst Jeffrey Grau, who authored the report. "We're finding satisfied shoppers, profitable online retailers and increased revenues. The future of U.S. e-commerce looks promising."

Excluding travel, computers are still the biggest category for online purchasers, but a host of 'non-tech' products are growing rapidly as well, including apparel and home products. The report also includes findings from a recent study that show in 2003, 79% of all online retailers were profitable, up from 70% in 2002. Catalogers had the most profitable Web sites, with 28% operating margins, a 22% increase over 2002. Web-based retailers enjoyed profit margins of 15% in 2003, compared to 16% losses in 2002.

Key topics covered in E-Commerce in the U.S.: Retail Trends include:

--  What are the growth prospects for retail e-commerce?
--  What are the biggest and fastest-growing online product categories?
--  How do shoppers use search engines to conduct research and how can
    online marketers capitalize on this behavior?
--  How are online retailers driving consumers to their Web sites? And how
    effective are they at converting visitors into buyers?
    
For more information on purchasing a copy of E-Commerce in the U.S.: Retail Trends, visit eMarketer online at http://www.emarketer.com.

About eMarketer

eMarketer is "the First Place to Look" for market research information related to e-business, online marketing and emerging technologies. eMarketer aggregates and analyzes e-business research from over 1,700 sources and brings it together in one place. This research is presented in analyst reports and the "eStat Database" -- the most comprehensive compilation of up-to-date e-business and online marketing statistics in the world. For more information, visit www.emarketer.com.

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