eLab eXchange members overestimated how successful online holiday shopping would be in Q4 2007. Members predicted that fourth quarter 2007 online holiday sales would increase by 24.5% from Q4 2006. For the past several years, quarterly online holiday sales have increased nearly 25% each year. However, growth slowed this past year. The U.S. Department of Commerce estimated Q4 2007 US online retail sales increased only 18.2% from Q4 2006. (Estimates for 2007 and final estimates for 2006.)
If this estimate is any indication, it suggests we could be in for a rough year.
4 comments ↓
As a veteran Realtor I can say I witnessed a lot of concern and indecision from both home buyers and investors for a good part of 2007. As home prices started to fall, gas prices increased, and commodity prices increased, consumers started to feel the pinch.
This concern led to the slowest 4th quarter (2007) in terms of sales in our local Board since 2003. For most of 2007 through today home buyers are very hesitant to commit. Many feel home prices will drop further and will miss out on lower home prices if they purchase a home now. This has caused home prices to drop every month in our board.
As for internet shopping, I have to feel the increased price of gas and groceries, specifically anything with wheat products, has caused many shoppers to limit their spending across the board.
Many homeowners caught in the foreclosure nightmare are resorting to using credit cards to fund their day to day living expenses and credit card debt has risen dramatically in the past several quarters.
This all has to have a severe impact on not only on-line shopping but all kinds of sales.
Once the increases level out more people willbecome interested in saving time, fuel and local sales taxes. I think more big ticket items will be bought on the internet. The trend is still there it is just being slowed down by overall spending. A better indicator is the number of items bought via the internet.
Interesting perspectives from the people who commented.
We have the same problem if not a bigger one in South Africa. The problem we have is that our interest rates are currently sitting at 14.5%. House prices are unaffordable and fuel price are escalating daily. So what we’re finding is people are now shopping for food, daily expenses online. It’s cheaper and because the online market in relatively new, specials are great as big markets are trying to attract more people to their online shopping gateways.
Maybe there is an upside to all this world turmoil we find ourselves in.
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