Online sales continue to rise, up 23.1% from a year ago

Computerworld - While they're still only a tiny portion of overall U.S. retail sales, retail online sales continued to rise in the second quarter to $15.7 billion. That's up 23.1% from the $12.7 billion posted in the same period a year ago.
The estimated figures were released today in a report (download PDF) from the Census Bureau of the U.S. Department of Commerce, which tracks retail sales and other economic indicators for the nation.
Overall retail sales through traditional brick-and-mortar stores and e-commerce sales totaled $919 billion in the second quarter, which ended June 30. That was 7.8% higher than the $852 billion posted for the same period last year, according to Commerce Department figures.
The quarterly e-commerce sales accounted for just 1.7% of total retail sales, a slight uptick from the second quarter of 2003, when e-commerce sales made up 1.5% of total retail sales. In the first quarter of 2004, e-commerce sales were 1.9% of total sales.
A spokesman for the Commerce Department's Center for Economic Studies couldn't be reached today for comment.
E-commerce sales in the second quarter were up about 0.9% from the previous quarter, while overall retail sales rose about 10.1% for the same period.
Analyst Carol Baroudi at Baroudi Bloor in Arlington, Mass., said the continuing increases in e-commerce retail sales from quarter to quarter "speaks to the enormous potential for e-commerce." Even so, traditional retailers aren't likely to be bested by online sales anytime soon.
"Is [e-commerce] going to replace the corner store? No way," she said. "I still think we're at the very tip of the iceberg. Is it going to hit 50% of sales anytime soon? No, but it is going to grow like gangbusters."
William Cody, managing director of the Jay H. Baker Retailing Initiative, an industry center at the University of Pennsylvania's Wharton School, agreed that while e-commerce is small compared to traditional retail sales, it will continue to play an important role in the economy.
"It hopefully will be an additive [sales driver] for specific retailers who do it well," Cody said. But online retail won't likely ever take over the sales lead from retail stores and malls because "one of the few social activities out there is going shopping. You're not going to get rid of the social chase."
E-commerce sales figures for the fourth quarter of 2003 ended the year on a high note (see story), with $17.2 billion sales in the final three months of 2003, up a hefty 25.1% from the $13.7 billion in sales posted