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Online Sales Will Save the Holiday Season

NEW YORK (TheStreet) - Consumers are using the Web and mobile devices to make retail purchases, as opposed to going to bricks-and-mortar stores. This holiday season, as stores look to lure shoppers with promotions and deals, online sales are likely to be the shining star, in an otherwise tepid selling season.

ShopperTrak revised its holiday traffic expectations lower as a result of new methodology. It now expects 10% fewer shoppers to visit bricks-and-mortar stores in November and December than last year. The retail analytics provider had originally predicted that in-store traffic would decline 1.4% for the holiday season. ShopperTrak had revised its methodology for tracking traffic by expanding its data to include more stores and categories, including dollar stores, home furnishings, sporting goods, office supply, gifts stores and mass merchandise along with the already tracked apparel and accessories, wireless and electronics and enclosed mall sectors, it said in a release.

ShopperTrak specifically expects traffic in electronics and appliance stores to fall by 11.5% compared to 2012, however, retail traffic in apparel and accessories is expected to rise 5%.

Same-store sales growth at the nation's retail chains, i.e. sales growth from retail stores that are open at least one year, is expected to rise just 1.8% for the third-quarter, according to Thomson Reuters. Excluding Wal-Mart (WMT) the biggest retailer, same-store sales are expected to rise 2.5%.

According to the latest report by the Commerce Department released on Friday, U.S. retail e-commerce sales rose 3.6% from the second-quarter, and 17.5% from a year ago earlier to $67 billion. The number is adjusted for seasonal variation but not for price changes, the Commerce Department said. Unadjusted, U.S. retail e-commerce sales totaled $61.4 billion last quarter, up 2.1% from the second quarter 17.3% from a year earlier.

Online sales may still be a small portion of overall retail sales (sales in the third quarter of 2013 accounted for 5.9% of the $1.14 trillion of total retail sales), but the fact is it's growing significantly while stores sales remain mediocre at best.

Meanwhile Amazon (AMZN - Get Report) the online powerhouse, supported a good portion of U.S. e-commerce sales, as third-quarter revenue jumped 24% to $17 billion. Sales for the fourth-quarter is expected to come in between $23.5 billion and $26.5 billion fueled by the holiday season.

Amazon said earlier this month that it partnered with the U.S. Postal Service to start making Sunday package deliveries.

Must Read: Ann Taylor 3Q Earnings Beat Estimates, Analyst Says Buy

Retailers often like to talk about their so-called omni-channel strategies, which includes a variety of channel options for consumers to buy including in store, online and mobile selling.

As the fiercely competitive holiday season kicks off with Thanksgiving weekend sales, those retailers that hype-up promotions specifically for online and mobile purchases will be the winners this season.

Written by Laurie Kulikowski in New York.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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