Skip to main content

With holiday shopping getting into full gear on Friday, analysts are expecting another big year for online sales.

While Black Friday -- the day after Thanksgiving that moves retailers out of the "red" -- marks the traditional start of the holiday shopping season in the brick-and-mortar world, Internet shoppers have been cruising the virtual aisles for at least two weeks now, analysts say. Early data indicate that sales thus far haven't been as fast-paced as some have expected, but analysts expect that to pick up in coming weeks.

"We still expect to see increasing momentum as the season progresses," said Dan Hess, senior vice president at online research firm comScore Networks.

Online retailers appear to be entering the main stretch of the holiday season with their engines revved:

comScore, for instance, estimates that consumers spent $2.7 billion online in the first two weeks of November, excluding travel and auction purchases, up 20% from last year. The company eventually expects online purchases in November and December to grow by 23% to 26% over the same period last year.

According to the U.S. Census Bureau, online sales grew 24% in the first nine months of this year to $50.5 billion. In the fourth quarter last year, retail Internet spending grew 25% over the fourth quarter of 2002.

In the year-to-date, overall retail sales, including sales of cars and car parts, have grown by a healthy 7.4%. And analysts expect sales growth of around 5% for core retail spending during the holidays.



Shopping, which is one of the primary shopping search engines, has seen traffic to its site increase 30% to 40% over last year.

Rival shopping bot

Scroll to Continue

TheStreet Recommends

(SHOP) - Get Shopify, Inc. Class A Report


predicted that its fourth-quarter revenue will increase 33%, boosted by strong holiday sales.


(AMZN) - Get, Inc. Report

CEO Jeff Bezos has predicted that the company will post a record holiday season.

Amid the strong momentum and high expectations, many e-commerce stocks have

soared in recent weeks.


(EBAY) - Get eBay Inc. Report


(OSTK) - Get, Inc. Report

, for instance, each hit an all-time high on Friday, while,

( ECST) and

GSI Commerce

( GSIC) are all trading near the top of their 52-week ranges.

Part of what's happening in online sales this year is that Internet shopping is becoming increasingly mainstream, analysts say. Consumer electronics, computer equipment and media products have traditionally comprised the bulk of online holiday purchases. But consumers are increasingly willing to buy products such as furniture, tools and jewelry online.

In the week ended Nov. 14, online shopping visits were up 60% over the previous week, according to Nielsen NetRatings. Among the groups of sites that saw the greatest traffic increases were those selling books, music and videos, those offering toys and video games and those specializing in home and garden products, according to the research firm. Notably, shopping visits to

Home Depot

(HD) - Get Home Depot, Inc. Report

were up 159% from the previous week.

Meanwhile, Amazon put out a list of its best-selling products in the holiday season to date. The company did not rank its overall top-selling products, instead choosing to break out the top three sellers in each category. Still, among those products making the list were $110 Ugg boots, the best-seller in the apparel and accessories category, and a $300 nail gun kit, which topped the company's tools and hardware store.

At Yahoo! Shopping, computers and electronics products typically dominate the top 10 goods that visitors search for during the holiday season, said Rob Solomon, vice president of the shopping site. But this year, just three of the top 10 most-popular products are computer- or electronics-related, he said. The rest of the items on the list are apparel, home and garden or general merchandise products, he said.

What's changing in e-commerce is "the degree to which consumers see this as a place to buy every type of gift product," said comScore's Hess.

"In years past, people thought of it as the first place to shop for an MP3 player or a DVD player. This year, more than ever, it's a viable place to shop for a piece of furniture or a high-end watch or jewelry item."

And it's not just online-only players benefiting from the increasingly mainstream nature of Internet shopping, Hess and others say. Retailers whose online stores are tightly integrated with their brick-and-mortar businesses are doing well also. Among those who are likely to see strong online sales, said Hess, are


(WMT) - Get Walmart Inc. Report



(S) - Get SentinelOne, Inc. Class A Report


J.C. Penney

(JCP) - Get J. C. Penney Company, Inc. Report



(TGT) - Get Target Corporation Report


"The broadline multichannel retailers are stronger than ever," Hess said.