E-commerce is one of the few industries, which is not badly effected by the recent financial crisis. Though it may have some lean patches in the last year, it recovered quickly and has the growth potential over next year. The harsh economic situation drove companies to choose online retailing as it has more efficient solutions with easily measurable results at lower costs. However, it didn’t disappoint them, as e-commerce was not much affected by the crisis.

E-commerce spending recorded a 3 percent year-over-year growth in the fourth quarter of 2009 signaling a positive note for the next year. According to a latest comScore report, online retail spending crossed $39 billion in fourth quarter 2009 marking a 3 percent year over year growth. The total retail e-commerce spending for the complete year 2009 reached $129.8 billion. The number is slightly lower than in 2008 where it was $130.1billion.

There was a significant growth in year over year e commerce spending in 2007 and in the first half of 2008, even in big economic crisis. It recorded negative year over year growth in Q4 2008, Q2 2009 and Q3 2009 only. There was not much difference in Q1. Again in 4th quarter online spending increased proving it as a good prospect for the next year.

Travel online sales accounted for $80 billion in 2009
The total e-commerce sales in 2009 including spending on travel stood at $210 billion. It was marginally down 1.8 percent compared with $214 billion in 2008. The total over the year e commerce sales in 2007 and 2008 grew 17% and 7% respectively. But only in 2009, it recorded a marginal negative growth. However, it was a very good year for the travel industry. It accounted for 38 percent of the total e commerce sales, $80 billion out of $210 billion.

E-commerce accounted for 7.7 percentage of total retail spending in Q4
Out of the total retail spending, online purchases accounted for 7.7 percent in Q4. It increased from 6.9 percent in Q3.

In the fourth quarter, the best performing categories included jewelry, watches, consumer electronics, computer software, event tickets, magazines and books. Sales of toys and hobbies fell significantly during this quarter. Furniture appliances and equipment, video games, apparel and accessories, flowers and gift sales dropped slightly.

Large online retailers increase market share at expense of small retailers
Large online retailers grabbed the maximum market share of e-commerce sales over the small and medium-sized retailers. According to comScore, online retailing giants Amazon and Wal-Mart Stores combined accounted for 87 percent of all retail e commerce sales in the 2009 holiday season. Top 25 online retailers’ sales increased by 11 percent where as other retailers’ sales decreased by 7 percent. Nearly 40 percent of the largest 25 online retailers gained more than 10 percent sales.

EBay’s traffic fell 11% and so did traffic for 7 of top 10 retailers
According to Nielsen Online reports, EBay’s traffic fell 11 percent in December 2009 compared to the same period in the previous year. This is the third consecutive month where eBay’s traffic declined from the previous year. Amazon on the other hand had the most traffic among retail sites with 66.47 million unique visitors in December.

When the top 10 online retail destinations in December’09 are compared by growth of unique visitors over the year, 7 out 10 retailer’s reported a drop in traffic. Out of the top 10 online retailers only Amazon, Wal-Mart’s and Verizon Wireless improved their traffic.

Key takeaways from fourth quarter
•    December 15 was the heaviest online spending day in history with $913 million spent on single day
•    Amazon and Walmart combined share most of the online market share
•    Small and medium-sized retailers record negative growth in visitors
•    More than 40 percent of e-commerce transactions during the holiday season offered free shipping

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