Online retailers work harder to convert browsers into buyers.
Thursday, December 13th 2001, 12:00 am
By: News On 6
NEW YORK (AP) _ Online holiday traffic is surging, but e-tailers, like their brick and mortar counterparts, are still working hard to turn cautious browsers into spending shoppers.
The task is made more difficult this year because many online retailers are hoping to be profitable this holiday season. As well, many consumers nervous about the economy are spending less than they did last year.
E-commerce sites are promoting shipping deals or price discounts in hopes of attracting spending customers. Free shipping offers, which has proved effective for many online retailers, are being scaled back by some sites.
Luxury online retailer Ashford.com, which provided unlimited free shipping last year, now offers it only for purchases of $1,000 or more. For Toysrus.com, it's $150, up from $100 a year ago.
``Free shipping is getting a lot of people into the online store, but consumers are finding new hurdles,'' said Chuck Davis, chief executive of Bizrate.com, a research firm that tracks 2,000 online sites.
Davis' site now lists 116 free shipping offers from online merchants, compared to about 80 last year. But the average shipping charge is up 37 percent to $10.67 from $7.78.
Many online retailers have decided to use heavier price discounting to woo consumers nervous about job security amid thousands of layoffs.
``We have been more aggressive discounters than ever before and we are right now,'' said Jeff Bezos, chief executive of Amazon.com, which hopes to reach profitability in the fourth quarter.
Two months ago, Amazon.com increased its everyday discounting to 30 percent off almost all books over $20. Bezos said the company can afford the discounting because it has worked hard to increase operating efficiencies.
Jennifer Dulski, senior brand manager at Yahoo!, which has more than 10,000 merchants on its market site, said there is more discounting this season compared with a year ago, particularly on luxury brands.
E-tailers can be more effective at offering discounts to specific consumers than brick and mortar stores can. For example, they can send e-mails to frequent shoppers.
So far, traffic levels this holiday have surged 45 percent to 50 percent, according to Jupiter Media Metrix, an Internet research firm. The firm predicts the final sales figures will reach $11.9 billion, an 11 percent gain from a year ago.
``We are definitely seeing that people are shopping around online more this year, because of the discounts, and that is why traffic is up,'' said Rob Leathern, a Jupiter Media Metrix analyst.