Worried holiday shoppers turn to online shopping

Tech-savvy consumers hunting for Christmas gifts this year are expected to spend more money online than in stores, according to a quarterly report released by a New York-based public-interest groupRespondents to the Conference Board's most recent quarterly survey said they plan to increase their online purchases this month and next while simultaneously cutting their spending in physical stores. Each quarter, market research firm TNS Retail Forward surveys 10,000 households to compile data for the nonprofit Conference Board and its Consumer Internet Barometer. "Given the current economic environment, it is no surprise that consumers are reining in their spending and seeking bargains," said Lynn Franco, consumer research center director for the Conference Board. Households with online access that are planning to spend more than $500 in stores declined to 16 percent from 21 percent last year, according to the report, while those planning to spend more than $500 online rose to 5 percent from 4 percent last season.Those planning to spend between $100 and $499 in stores declined to 57 percent from 61 percent last year, while those planning to spend that amount online edged up to 36 percent from 35 percent last year. Online households planning to spend less than $100 in stores increased to 22 percent from 16 percent last year. Those planning to spend that amount online rose to 32 percent from 29 percent.About 93 percent of women surveyed, versus 87 percent of men, said free shipping would motivate them to spend more online this holiday season. More than 71 percent of shoppers said special offers and deals not available in stores would boost their online spending, with little difference between men and women. More than 70 percent of women and 68 percent of men said they would be willing to spend more if merchants offered coupons/discounts.Books, clothes, movies and toys will be the most popular items on the consumer's Internet shopping lists, according to the Consumer Internet Barometer.That people are hopping online to bargain hunt should come as no surprise, according to Dan de Grandpre, editor in chief of dealnews.com, a consumer-interest web site. "It's only the worst time in retail history since I've been born," said the 38-year-old de Grandpre. "People (are) reacting very strongly" to current economic conditions. The national unemployment rate for all workers hit 6.5 percent last month as companies deal with a worldwide recession sparked by credit-market troubles in the United States.The National Retail Federation has forecast the worst holiday season -- a period that typically accounts for 20 percent to 35 percent of retailers' annual income -- since 2002.The run-up in gasoline prices earlier this year pushed some of those people who did have money to buy goods online, de Grandpre said. People who weren't tech-savvy experimented with online shopping, he said, and those who were tech-savvy bought even more online than they had in the recent past.That behavior is likely to benefit companies that sell things online in November and December, experts say."Despite slowing retail sales in many channels this holiday season, online shopping is likely to be one of the few bright spots this holiday season," said Mary Brett Whitfield, a research director at TNS Retail Forward.It won't be easy for online retailers to get people to commit to a purchase, de Grandpre noted, as shoppers will expect to get perks such as free shipping, free return postage on unwanted items and coupons that save them money."If you're an online retailer and you stop things like free shipping, you're in trouble," he said. According to de Grandpre, clothing for sale online "has been marked down so much right now I don't know how much lower (prices) can go."Electronics retailers are going to be very aggressive with discount offers for the next couple of months, he said.For electronics, de Grandpre prefers sites such as buy.com, fryes.com and newegg.com The general shopping sites most preferred by respondents to the Consumer Internet Barometer survey are those operated by retail store and catalog operators such as Walmart.com or BestBuy.com, followed by online retailers such as Amazon.com and online auction sites such as eBay.com.E-mail Paul Grimaldi at Providence Journal at pgrimald(at)projo.com.(Distributed by Scripps Howard News Service, www.scrippsnews.com.)