Half of online shoppers did not return in 2000 -- cost to retailers: $2.6 billion

[January 16th 2001]

Results from a survey of consumers just completed by Gartner Group, Inc. show that 24.5 million Americans bought holiday gifts online this past season. In total, consumers in North America spent nearly $6.2 billion online for holiday gifts.

Gartner estimates that $2.6 billion in online sales were lost from consumers who bought holiday gifts online in 1999 but failed to come back to the Web for this year's gift buying. Just less than half of online holiday purchasers, or 11 million, bought holiday gifts online in 1999. This year, almost as many consumers who bought holiday gifts online in 1999, stayed away from the Internet for this year's gift buying. Gartner estimates that if these consumers had bought on the Web this past season, online retailers would have seen another $2.6 billion in spending, an increase of 43% of the actual online holiday gift sales.

"Loss of repeat customers clearly points to the CRM and customer service issues faced last year by retail Web sites," said David Schehr, a research director at Gartner. "This level of churn from one season to the next shows the opportunities as well as the risks for retailers. Overall, three-quarters of these online gift buyers were very satisfied with their gift-buying experience online; so most should be back next year. But retailers can't rest on their laurels if they plan on growing their e-commerce activities. At most, they have 341 days to fortify their systems and get it right for the 2001 shopping season."

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