Digital Media

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)

Christmas came early for Google.

The Internet search giant posted double-digit year-over-year Cyber Monday gains on a select group of consumer categories, including department stores, books and magazines, home furnishings, and sports and fitness, according to its retail blog.

Paid click results rose a whopping 39 percent for department store searches, while books and magazines were up a healthy 28 percent. Bargain hunters, meanwhile, drove up comparison shopping clicks by 25 percent and sports and fitness by 24 percent, analyst Ben Schachter noted in a research report released Friday.

Home furnishings settled in with a comfortable 14 percent increase, while apparel donned a 9 percent gain.

(Credit: Google)

Schachter, in his research report, noted:

It is not often that GOOG releases such data points, making it difficult to put this data into context. However, seeing key categories up 9 percent to 39 percent year-over-year is a positive, and indicates that consumers are still searching for retail products, deals, and coupons. We remain cautious on the holiday/4Q outlook however (due in part to the five fewer days between Thanksgiving and Christmas this year), but it's interesting to see GOOG releasing this type of data.

Google's double-digit results followed along the same lines noted by ComScore, which said Cyber Monday e-commerce sales rose 15 percent year-over-year. And the Thanksgiving weekend, overall, climbed 13 percent, ComScore said.