Total online retail sales are on track to zoom past the US$200 billion mark this year, more than double the US$100 billion volume reached just three years ago.

According to a recent study of 174 retailers conducted by Shop.org/Forrester Research, total online transactions are expected to rise 20 percent over last year, to US$211.4 billion. Excluding travel, online sales in 2006 are projected to reach US$138 billion.

Total online retail sales last year rose 25 percent to US$176.4 billion. Excluding travel, online sales rose 28 percent to US$113.6 billion, representing 4.7 percent of total retail sales in 2005.

Apparel, accessories, and footwear should claim US$13.8 billion of the total online spending this year, not far behind computer gear, which is expected to be the leading category at US$16.8 billion. Sales of cosmetics and fragrances are expected to increase 30 percent, the strongest growth category.

The most successful online retailers are utilizing their Web sites to create multichannel environments.

Nearly 80 percent of retailers maintain pricing across channels, and 46 percent allow customers to buy and redeem gift cards online and in stores. Thirty-three percent allow customers to accrue loyalty program points across channels, and 26 percent offer in-store product information online.

“Retailers spent the first decade of e-commerce scrambling to react to and learn about the Internet,” said Carrie Johnson, lead author of the report and research director, vice president at Forrester Research. “Companies are now able to take a step back and are busy planning strategies and prioritizing technology investment for the long term. As a result of these efforts, the next five to 10 years of online retail will be even more competitive and more innovative than in the past.”

Source : Nationaljeweler.com

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