LOCAL ECONOMIC SNAPSHOT | ONLINE SHOPPING

Gains expected this holiday season

By MARIA HALKIAS
Staff Writer mhalkias@dallasnews.com

Millions more people have access to online shopping this holiday season than just last year with the increase in broadband connections and the proliferation of tablets and smartphones. All these connections are the equivalent of rooftops built around new suburban malls in the 1970s and 1980s. Excluding food, Internet shopping is forecast to represent 15 percent of all U.S. retail sales by 2015, according to Forrester Research Inc.

Texas-based retailers growing online sales at a faster rate than overall revenue
Heres a list of the biggest e-commerce companies headquartered in Texas. Rankings based on online sales only according to Internet Retailers annual list of Top 500 business-to-consumer retailers in the U.S. and Canada. Other national Texas chains such as Fort Worth-based Pier 1 Imports and Dallas-based Tuesday Morning are in the early stages of building their online infrastructure. Internet Retailer 2010 ranking 4 20 42 96 118 194 196 210 215 230 254 257 308 363 379 406 474 475 2010 online-only sales $4.8 billion $1.53 billion $569 million $188.6 million $159.4 million $76 million $75.5 million $68.4 million $65 million $56 million $48.3 million $47.3 million $32 million $25.5 million $23 million $19.6 million $13.8 million $13.7 million

Texas-based company Dell Inc. J.C. Penney Co. Blockbuster Army & Air Force Exchange Service GameStop Corp. Zale Corp. Fossil Inc. Golfsmith International Blinds.com Cheaper Than Dirt RadioShack Corp. Teamexpress.com Container Store Mens Wearhouse Sally Beauty Calendars.com Wisteria Conns.com

Headquarters Austin Plano McKinney Dallas Grapevine Irving Richardson Austin Houston Fort Worth Fort Worth San Antonio Coppell Houston Denton Austin Farmers Branch Beaumont

Percentage change from 2009 6% 2% 3% -6.3% 20% 22.6% 50% 25.9% 32.4% 11.1% 5% 24.5% 26.2% 155% 9.5% 11% 11.4% 8.7%

Online shopping
U.S. e-commerce sales have seen positive year-over-year gains for seven consecutive quarters. The government will report the third quarter on Thursday. Second quarter 20 2011: 14%
15

Online shopping tools

Forecast for U.S. households with broadband subscriptions: For many, its viewed as a necessary utility in the home, the same as water and electricity.
(In millions) 100 80

What is the forecast?

US online retail sales will reach $279 billion by 2015. While thats a big number, whats more impressive is that online spending will represent 15 percent of all U.S. retail sales excluding grocery in four years.
(In billions) 300 250 200 150 100

89.8 million

$279 billion

10 5 0 -5

60 40 20 0 08 09 10 11
10 11 12 13 14 15

50 0 09 10 11 12 13 14 15

Valuable online shoppers

The most valuable digital consumer is social, mobile and local, according to a Nielsen/McKinsey research. SOCIAL LOCAL MOBILE

Forecast for U.S. tablet sales

Its hard to think its only become a consumer commodity for a year.
(In millions of units) 30 25 20 15 10 5 0

27.9 million

64%
of parents use social media to learn about brands

45%
of local deal shoppers are very likely to recommend the daily deal site

38%
of Americans own a smartphone

10

11

12

13

14

15

SOURCES: Forrester Research; comScore Inc.; Parks Associates; Nielsen/McKinsey

The bottom line

E-commerce sales have been growing at the expense of physical brick-and-mortar retailers as consumers increasingly look to the Web for its selection, prices and convenience. Excluding grocery sales, 11 percent of (2010) retail sales were online. Some categories, such as PCs, have an online penetration of 50 percent. Sucharita Mulpuru, vice president and principal analyst, Forrester Research People have the tools to research and buy online and thats why more and more consumers are choosing to avoid the holiday rush. The Amazon.com Kindle is a device totally aimed at online shopping. Its a subsidized tablet that makes it up with product sales. If you build it they will come was a good mantra for shopping center developers for years as they followed new housing construction in suburbia. Today I think of my iPad as another digital rooftop. Im shopping more online because of it.

Kurt Scherf, principal analyst at Parks Associates in Dallas.

Maria Halkias, staff writer, The Dallas Morning News