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Holiday e-commerce up 25 percent

U.S. online retailers posted holiday sales of over $23 billion, a jump of 25 percent from the 2003 season, according to a new survey released on Monday.
/ Source: Reuters

U.S. online retailers posted holiday sales of $23.2 billion, excluding travel, up a larger-than-expected 25 percent from the 2003 season, according to a new survey released on Monday by Goldman, Sachs & Co., Harris Interactive and Nielsen/NetRatings.

"Improved satisfaction, greater selection online and extended shipping deadlines drove greater-than-expected spending online this season," Goldman Sachs analyst Anthony Noto said in a client note.

The three firms previously forecast year-on-year growth of 20 percent, weaker than 2003's growth rate of 30 percent.

Their annual holiday eSpending Report was based on weekly surveys of more than 1,000 respondents and covered the period from Nov. 1 to Dec. 26. Unlike other surveys, it included data from auction site eBay Inc. , the Internet's most popular U.S. retail site.

Consumers spent $3.76 billion in the apparel and clothing category, which contributed the largest share of online dollars at 16 percent. Toys and video games grabbed 11 percent of total spending with $2.53 billion. Consumer electronics came in third at 10 percent with $2.31 billion.

The jewelry category was the fastest growing, with online sales of $1.89 billion, more than double 2003 holiday sales of $888 million.

EBay and Amazon.com  -- which has already announced record-breaking holiday sales -- were again the dominant Web retailers, said Heather Dougherty, senior retail analyst at Nielsen/NetRatings.

Noto said eBay and search-related companies like Yahoo Inc., Google Inc. and Shopping.com will benefit most from strong demand and increased online competition. In a separate note, he raised fourth-quarter revenue and earnings estimates for both Yahoo and Google.

Elsewhere, Web discounter Overstock.com saw a big jump in holiday visits after investing in a massive computer systems overhaul.

Sites run by major bricks-and-mortar retailers such as Wal-Mart Stores Inc., Target Corp., Home Depot Inc. and Best Buy Co. also saw hefty traffic increases on the heels of major marketing campaigns, she said.

The top reasons for shopping online included avoiding crowded stores, the availability of lower prices and wide selection, said respondents, almost a third of whom reported a better holiday shopping experience in 2004 than in 2003.

Last week, Internet research firm comScore Networks said holiday online sales -- excluding travel and auctions -- were $14.8 billion, up 29 percent year-on-year.

Shares of eBay closed down almost 2 percent at $114.11 while Amazon's stock finished up nearly 1 percent at $44.52 on the Nasdaq. Google shares gained just over 5 percent to $202.71 and Yahoo was up more than 1 percent at $38.18.