Online Holiday Sales to Hit $32 Billion?

JupiterResearch forecasts that online holiday retail sales will increase to $32 billion in 2006, an increase of 18 percent. But what will folks buy?

A new report from market analysis firm JupiterResearch forecasts that online retail holiday sales for 2006 will jump by 18 percent to account for some $32 billion. Overall, the firm estimates a record 114 million people will use online shopping to avoid lines and crowding at retail outlets, a six percent increase in the number of online holiday shoppers compared to 2005.

Amusingly, JupiterReseach also found that as many as one third of online shoppers will make their purchases at the last minute, so retailers offering up-to-the-second overnight shipping options may have an edge over more traditionally paced options.

What will consumers be buying? Rival market research outfit the NPD Group thinks this will be the year consumers focus on “tried and true” holiday gifts like clothing and toys, with an overall modest growth in spending compared to 2005 across both online and traditional retail channels. The NPD Group also finds consumers most eager to hit Mass Merchant and Discount outlets, with retail chains and online shopping rounding out the top three ways consumers plan to shop this year. According to the NPD, clothing, toys, books, music, and fragrances will all see gains in sales compared to 2005, with electronics being the only major category seeing a decline compared to the previous year.