Holiday e-commerce growth slowed this year, analysts say Dec. 24, 2000   By JIM BROOKS Reading computer news on the Web, you get the feeling that no two writers have the same opinion of the health of online shopping this holiday season. Despite the continued growth and popularity of computers in American homes, a new survey indicates that holiday e-commerce sales won't see a huge increase in numbers this year. According to a recent CBS News/New York Times survey, 35 percent of Americans with Internet access plan to buy or have purchased gifts online -- virtually the same percentage as last year. A couple of bright spots in the survey show that e-commerce still has a future. The survey showed that online shoppers like e-commerce -- nearly 70 percent said online shopping was better than going physically to a store. Ninety-seven percent of the people surveyed said they would buy gifts online again. The National Retail Federation and Forrester Research both predicted sizable increases in holiday e-commerce spending. But other analysts say that a variety of events have shaken consumer confidence in online sales, including the presidential election, sluggish computer sales, the general downturn among Internet companies, and poor performance from past e-commerce experiences. In fact, a survey from the Boston Consulting Group and Harris Interactive said holiday sales will increase, but at a dramatically lower rate than the triple-digit levels of the seasons past. Many potential shoppers have opted to avoid online shopping this year, the study found. The firms called their findings "a warning for online retailers." Once the darling of e-commerce, the eToys Web site has already announced the holiday season were significantly below its projections. The E-Commerce Times called their projected sales figures "a catastrophe." The real e-commerce winner -- or survivor -- this year appears to be Amazon.com. By mid-December, the company had shipped 25 million holiday items, compared to 20 million during the 1999 sales season. A report issued by Media Metrix found that e-commerce traffic at top Web retailers peaked a couple of weeks ago. Media Metrix's conclusion is that buyers who shopped late last year -- and received their packages late -- were purposely more cautious this season. Last year, one of the hottest toys were Color GameBoys. These units were nearly impossible to find in stores by early December last year. Checking eToys.com, I found they too were sold out of Color GameBoys. The eToys.com Web site offered an e-mail alert service to let shoppers know when an out-of-stock item was back in stock. I signed up for the service, hoping the GameBoys would be back in stock by Christmas. I heard nothing from eToys until Feb. 10, 2000, when I was alerted the GameBoy I was seeking was now back in stock and ready to ship. Like this year's holiday sales among many e-tailers, it was too little, too late to help. BLUELIGHT'S REDLIGHT. Free Internet service provider BlueLight.com, an affiliate of Kmart Corp., announced it would now put restrictions on its access. BlueLight.com users will now be restricted to 25 hours per month of access. Through its affiliation with Kmart, BlueLight.com had been one of the fastest-growing free Internet services. The company has 5.5 million users, according to a press release. The access limit was a move to cut costs after BlueLight took over the service from its failed partner, Spinway. The average BlueLight.com user spent about 15 hours online, according to the company. Users over 25 hours were accounting for nearly half of the company's costs for providing the service -- without necessarily shopping online at the BlueLight.com Web site. COMPUTER TIP ADDENDUM. In response to my recent column that offered some tips on buying a home computer, Renee Allen Nowatka, an independent computer and technology consultant, said one aspect of performance that buyers need to remember is the computer's bus speed. The bus speed refers to how fast data travels inside the computer. As is the case with nearly all performance figures, faster is always better, though the performance charts for computers can be tougher to read than the bottom line on my optometrist's eye chart. Computer advertisements usually tout the processor speed -- say, 800MHz -- and only mention in the finer print the bus speed, which may be slower than a comparable, higher-priced model. Even a computer boasting a Pentium processor can have a bus speed as slow as 66MHz, which can hinder the performance of the CPU, Nowatka said. The "Intel Inside" logo doesn't always mean top performance, she advises. Nowatka points out that the performance difference between bus speeds may not be very noticeable, depending on what a user's needs are for their computer. Comments and questions about this column may be sent to jbrooks@myoldkentuckyhome.com, or visit www.myoldkentuckyhome.com on the World Wide Web. | HOME |