Retailing: E-Commerce Is Cleaning Up

When the dot-com bubble burst, many e-commerce businesses crashed and burned. But that didn't stop consumers from using the Internet as their own personal shopping mall. E-commerce now makes up 1.9% of all U.S. retail sales. Chief Economist Mark Zandi believes that e-commerce's piece of the retailing pie could double over the next four years.

The holiday season, of course, is the prime time for Internet retail sales, just as it is for brick-and-mortar stores. But once consumers get comfortable making purchases online during the holidays, they seem to stick around into the new year. Since the Commerce Dept. started tracking retail e-commerce in 1999, the Net's share of retail sales has generally jumped in the fourth quarter, held steady over the next year, and jumped again at yearend.

The most recent numbers confirm that trend: The Commerce Dept.'s first-quarter figures on retail e-commerce show sales hit $15.5 billion, up 28.1% from a year ago. The holiday season may be the key time to attract new online customers, but the potential for repeat business is plentiful all year round.

By James Mehring

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