Washington D.C. More than half of online retailers (56.1%) expect their holiday sales to increase at least 15% over last year, according to results of the 2008 eHoliday Study, conducted by Shopzilla for Shop.org.
However, the rate of growth is slowing: three-fourths (77.5%) of retailers surveyed last year expected their sales to grow more than 15%.
“Online retailers are resilient, but not immune, to the challenges of this holiday season,” said Scott Silverman, executive director of Shop.org. “Retailers will be heavily promotional to attract shoppers on a budget, but have also invested in new site features to improve the online buying experience.”
Despite an increase in transportation costs, retailers do not plan to cut back on popular free-shipping promotions.
This year, the majority of retailers (78%) plan to offer free shipping with conditions at some point during the holiday season, consistent with last year’s levels.
Retailers are compensating for increased shipping costs by renegotiating terms with shipping providers (40.4%), closely managing company headcount (33.3%), and reducing other promotions (15.8%).
In addition, one-fifth (21.3%) of retailers said they will require a higher purchase amount for customers to be eligible for free shipping and one in ten (10.6%) will cut back on usage of free shipping with no conditions.