Digital Media

Correction at 7:25 a.m. PST November 12: This article incorrectly stated the percentages of consumers planning to use social media and mobile phones to assist in their holiday shopping. Seventeen percent of consumers who were surveyed plan to use social media to help them shop, and 19 percent plan to use their mobile phones.

If you're looking for just the right gift for Aunt Sally, you may find yourself turning to social networks and your mobile phone this holiday-shopping season.

More consumers expect that these two aspects of technology will help lead the way this year, according to a recent survey from consulting firm Deloitte.

Deloitte, which surveyed more 10,000 consumers for its 24th annual holiday-shopping survey, drillled down on technology's effect on buying habits by releasing new statistics on Wednesday.

The survey found that 17 percent of consumers plan to use social media during the holidays. Of that 17 percent chunk, 53 percent plan to use social media to research gift ideas, 52 percent intend to check the wish lists of relatives and friends on social networks, and 60 percent plan to hunt for discounts and sales using social networks.

Mobile phones are also becoming a tool for bargain-hungry shoppers.

Among those surveyed, 19 percent plan to use their mobile phones to assist in holiday shopping. Of that 19 percent chunk, 55 percent expect to use their phones to find store locations, 45 percent to research prices, 40 percent to seek product information, 32 percent to find discounts, and 25 percent to buy a holiday gift.

The good, old Internet still rates as a top spot for holiday shoppers, with 22 percent saying they'll shop primarily online this year and 44 percent expecting to use a coupon they find online.

Online research is big for key purchases, with 39 percent saying they read reviews of stores or products written by other consumers and 34 percent indicating that such online reviews influence their buying decisions more than advertising.

The relationship between brick-and-mortar stores and their Web sites seems to be symbiotic. Among those questioned, 65 percent said they've purchased an item online after finding it in a store or catalog, while 78 percent said they've bought a product in a store after seeing it on the store's site.

"Consumers are turning to mobile, online and social media during their entire holiday shopping experience," Stacy Janiak, a Deloitte vice chairman, said in a statement. "Retailers should consider harnessing this activity to turn browsers into buyers with one-click access to coupons, promotions and purchasing tools. This year's leaner in-store inventories may also open the door for retailers to lure customers to their online channels where it is easier to access inventory, no matter where it is located."

Commissioned by Deloitte, the survey was conducted online by an independent research firm between September 24 and October 2 and included responses from 10,878 consumers.

Retail e-commerce posted its first quarterly decline in at least eight years, during the normally robust fourth-quarter holiday shopping season, according to a report released Thursday by ComScore.

During the fourth quarter, retail e-commerce sales fell by 3 percent to $38 billion, compared with a year ago.

"I thought things would be flat, so this was a little worse than I thought," said Gian Fulgoni, ComScore chairman.

He attributed part of the decline to fewer post-Thanksgiving shopping days in November last year, compared with the same time in the previous year when there was nearly one full additional week.

Retail e-commerce, however, was up 6 percent for 2008, compared with the previous year. And within the various e-commerce sectors, video games, consoles, and accessories--historically the strongest performer for the past few years--posted a 29 percent year-over-year increase.

(Credit: ComScore Inc.)

Music, movies, and videos, excluding those that are downloaded, fell 23 percent for the year, marking the worst performing category. Fulgoni noted that that category has historically performed the worst among the e-commerce categories.

Office supplies, which declined 10 percent, and jewelry, which fell 12 percent, posted gains over the past years, but this time around moved into the red as the recession took a number of companies out and made disposable income scarce.

And Fulgoni surmised that the 8 percent decline in online book sales could be tied to fewer people traveling by airplane and needing reading material to take on board.

While the fourth quarter marked the first time retail e-commerce sales encountered a quarterly decline, the industry has been posting shrinking sequential growth on a quarterly basis since the fourth quarter 2007.

"Gasoline and food prices began to go up with inflation in the fourth quarter of 2007, sucking away disposable income," said Fulgoni, who noted disposable income is predominately used for online purchases.

Staples such as groceries and necessities like fuel and energy are largely sold offline and, as a result, helped to prop up total retail sales during late 2007 and the first half of 2008, while growth in retail e-commerce sales continued to decline, Fulgoni said.

ComScore expects to release its January retail e-commerce results next week and Fulgoni said he's keeping his fingers crossed a little bit of growth will be reflected in the results.

"Gasoline prices are beginning to drop and that may put a little money in people's pockets," Fulgoni said. "But what may hurt us is the growing unemployment rate."

Amazon.com beat Wall Street's fourth-quarter revenue and earnings expectations, as the e-commerce giant posted strong holiday sales amid a weak economy.

Amazon's revenues jumped 18 percent to $6.7 billion for the quarter compared with the same period a year earlier. Wall Street had been expecting Amazon to generate sales of $6.4 billion for the quarter, according to Thomson Reuters.

The company reported a 9 percent increase in net income to $225 million for the quarter, or 52 cents a share. Wall Street was expecting a net profit of 50 cents a share, excluding stock options expenses.

Amazon stock rose 7.5 percent to $53.75 a share in after-hours trading.

"We're particularly grateful for the unusually strong demand for Kindle in the fourth quarter," Jeff Bezos, Amazon CEO, said in a statement in reference to the company's electronic reader.

During the fourth quarter, Amazon reported an 18 percent increase in U.S. and Canadian sales, compared to the same time a year ago.

Worldwide sales of its electronics and general merchandise climbed 31 percent to $2.89 billion in the quarter, compared with its performance a year ago.

Facing a tight economic climate and strong dollar overseas, eBay reported on Wednesday a 7 percent revenue drop in the fourth quarter and weaker net profits.

Shares of eBay, in after-hours trading, fell 6.25 percent to $12.45. The stock rose nearly 6 percent to close at $13.28 a share during regular trading.

The online auction giant reported revenue of $2.07 billion, down 7 percent from a year ago. That figure fell short of analysts' expectations of $2.12 billion in revenue.

eBay's net income, meanwhile, fell nearly 31 percent to $367 million in the fourth quarter, or 29 cents a share, compared with net income of $531 million, or 39 cents a share, a year earlier. Excluding charges, the company posted non-GAAP net profits of $524 million, or 41 cents a share, beating Wall Street's expectations of 39 cents a share profit, according to Thomson Reuters.

eBay CEO John Donahoe said in a statement:

While the holiday season was tough and competitive, our overall results for 2008 were strong.

For 2008, we delivered double-digit revenue and earnings growth; made significant changes in our eBay business; and built a stronger, more diverse portfolio of leading e-commerce businesses. We will build on our strengths in 2009 while managing our business prudently in the continued challenging environment.

Online holiday spending declined 3 percent compared with last year's online shopping season, the first negative growth rate in the past eight years, according to a ComScore report released Tuesday.

Between November 1 and December 23, U.S. online merchants recorded $25.5 billion in sales, down from $26.3 billion during the same period last year, ComScore reported. Gian Fulgoni, the research firm's chairman, blamed economic pessimism for the poor results:

The combination of having five fewer shopping days between Thanksgiving and Christmas and the severe economic headwinds faced by consumers has made this a really tough season for retailers, both offline and online.

Sales declined despite a 15 percent increase in sales on Cyber Monday, the second biggest day of online shopping ever. Cyber Monday saw sales of $846 million, capping off a successful Thanksgiving holiday weekend for the industry, which overall saw spending jump 13 percent.

When October sales are factored in, the sales picture appears even more bleak. Between October 1 and December 28, online sales declined 4 percent to $36.8 billion, according to ComScore's numbers.

However, traffic to top e-tailer sites increased 5 percent in December over the same period last year, according to ComScore numbers. Online auctioneer eBay saw a traffic decline of 4 percent, while Amazon.com saw an increase of 7 percent. Other gainers included Hewlett-Packard (28 percent), Apple (19 percent), and Wal-Mart Stores (4 percent).

Over the next few days, a picture of holiday sales will begin to materialize.

One of the first reports to surface doesn't sound incredibly painful until specific categories--like electronics--are broken out. And then the hurt becomes obvious.

MasterCard Advisors, a unit of the credit card giant, released on Friday its SpendingPulse analysis of national retail and service sales for the holiday-shopping season.

Overall retail sales year over year (excluding gasoline, which doesn't make a great holiday gift anyway) were down 2 percent in November and down 4 percent from December 1 to 24.

Overall, e-commerce fared relatively well from November 1 to December 24. It was down just 2.3 percent, reflecting the overall national trend. That seems to be in line with Amazon.com's positive report of its own sales.

The electronics and appliance category, however, showed a 26 percent decline over 2007. This category will become more interesting when sales figures for specific types of electronics become available.

So-called luxury sales, including jewelry, were down more than 34 percent year over year. Clothing sales were down about 20 percent.

Michael McNamara, a SpendingPulse vice president, didn't mince words. "A difficult economic environment combined with unfavorable weather during the last week of shopping made 2008 one of the most challenging holiday shopping seasons in decades," he said in a statement.

Here's a little statistical cheer for online retailers bracing themselves for what many have been predicting will be a dismal holiday sales season.

The latest online retail spending report released Tuesday by ComScore shows that consumers last weekend spent almost double what they spent on the corresponding weekend before Christmas last year. U.S. consumers online spent $677 million last weekend, December 20 and 21, compared to $341 million the weekend before Christmas in 2007, which was December 22 and 23.

It should be noted, however, that there are five fewer days this year between Thanksgiving and Christmas, making it harder to make perfect year-to-year comparisons. For example, the $677 million in sales last weekend--which was also the fourth weekend after Thanksgiving--is actually down 17 percent from last year's corresponding fourth weekend after Thanksgiving, December 15 and 16.

Whether you see the glass half full or half empty, the statistics suggest "that many consumers opted for the cozier confines of online shopping rather than having to brave the severe cold and snowstorms affecting much of the northern half of the country," ComScore Chairman Gian Fulgoni said in a statement. He added that the compressed shopping season probably resulted in some consumers buying online later than they did last year.

Regardless, the report is further evidence that holiday sales aren't a total disaster and might even be holding their own, which is no small feat in the throes of a recession. U.S. online spending to date this holiday season (from November 1 to December 21) totals $24.71 billion, down 1 percent from the corresponding timeframe last year.

Considering we're in the throes of a recession, online holiday sales appear to be generally holding their own.

(Credit: ComScore)

Google's gift to staffers: the HTC Dream, or G1, smartphone.

(Credit: James Martin/CNET Networks)

Clarification added December 30 (see text below).

For Googlers eagerly awaiting their famous holiday bonuses, be warned: Santa is tightening his belt too.

Google employees, some of whom have reportedly grown used to fairytale-like cash bonuses on the north side of $20,000, apparently got coal in their stockings this year. Certainly that's the takeaway for gossip blog Valleywag, which in a headline likened this year's bonus to "dogfood"--a euphemism for in-house testing--because Google would like some feedback. (Clarification: A few Google employees have contacted me to suggest that Valleywag's report on holiday bonus amounts of $20,000 likely confused performance bonuses with holiday bonuses said to be on the order of $1,000.)

So how bad was it? Well, Google gave its employees a smartphone. Yep, can you believe it? Man, if I had a nickel for all the years my bosses gave me a smartphone...

But I digress. Back to Google's gift. Apparently, Valleywag took issue with Google giving its employees an Android--its own phone! Well, actually, the memo that Valleywag reprinted referred to it as a "Dream phone." It's basically the T-Mobile G1 that retails for $179.99, but it's been customized to "work anywhere in the world" on the carrier of their choice. (Google estimates its value at $400.)

The nerve!

Here, in the real world, while many in the tech industry have received pink slips, Google employees are receiving a gift--oh, yeah, it is a gift--that many people would love to find under their trees. What a bummer, man. As far as the dogfooding goes, I am guessing that this company that has a reputation for being astoundingly generous when economic realities were more positive isn't going to can employees for not sending back the questionnaire.

Now, back to the topic of Santa...

Holiday spending on electronics for family members remains high on the to-do list, according to a survey by IDC and the National Research Network (NRN).

According to results from a survey of more than 3,000 consumers, 62 percent indicated they planned to spend the same amount or more on electronics for family members this holiday.

Those surprising results come as big-box electronics retailers face a challenging time. Best Buy announced a 77 percent drop in earnings and call for employee buyouts earlier this month and Circuit City filed for Chapter 11 bankruptcy last month.

Nonetheless, consumers are maintaining their holiday spending level for family members. Portable media players and digital cameras performed well over the holiday weekend that wraps in Thanksgiving, and high-definition TVs were expected to be the top electronic sale items between now and the end of the year, according to the survey.

"Consumers are shifting to staying, or nesting, at home more," Randy Giusto, IDC general manager of client and consumer markets.

The survey also found that while 25 percent of those surveyed shopped for electronics over the Thanksgiving holiday, 50 percent plan to buy electronics before the year's end.

Consumers plan to account for these recessionary times by reducing the frequency of eating out, and 38 percent of survey respondents noted they expect to spend less on gifts for co-workers.