Online Shoppers Still Hunt Down Bargains

Physician's Money Digest, June15 2003, Volume 10, Issue 11

Until recently, online retailers, hoping toattract shoppers to the Internet, regularlyran sales promotions and offered discounts.Now that online shopping hasgained a foothold, many Internet merchantshave cut back on such deals.However, online bargains can still befound. Shoppers just have to look harder.

EVOLVING E-COMMERCE

New York Times

According to a recent report, over the Thanksgiving 2002 longweekend, consumers spent $453.4 milliononline (excluding travel). This was a 67%gain over the previous year. The reportnotes that online retailers also enjoyedheavy sales on the Monday after Thanksgiving,raking in $231.5 million—up 37%from the same day in 2001.

While merchants are running fewer discounts,they have begun offering coupons,rebates, or free shipping. Several Web sitesnow exist that can help you find bargains.Price-comparison sites include BizRate.com,MySimon.com, and PriceGrabber.com.Other sites, such as AmazingBargains.com, FatWallet.com, eDealFinder.com, andDealNews.com, publish information aboutonline discounts and post coupon information.Some merchants are choosing todistribute coupons on other sites featuringdeals, says Ken Cassar, a retail analystat Jupiter Research.

Joseph Abate, an economist at LehmanBrothers, believes the Internet is evolvinginto an inventory-clearing mechanism. Hesays this is especially true of clothing, withbig discounts available on odd-sized orout-of-season items. Among several Websites that sell liquidated goods and excessinventory at deep discounts are Overstock.com and SmartBargains.com.

Times

Many online retailers have reduced orwaived shipping fees to keep customers,notes the article. In the summer of2002, Amazon.com reduced the minimumpurchase for free shipping to $49 from$99. Recently, the minimum purchase waslowered again to $25 for certain products.BarnesandNoble.com has free shippingwith the purchase of 2 products going tothe same location. And Buy.com offersfree shipping with no minimum purchase.

New York

Times

Band of

Brothers

Retailers sometimes offer a better priceonline than in their stores. The article notes, for example, that a traditionalBarnes & Noble store in LosAngeles was selling the DVD of the weekend before Thanksgivingfor $119.95, while the online store wasselling it for $71.99, plus $4 for shipping.

Some of the best online discounts canbe found on toys and prescription drugs,according to a survey by Lehman Brothersin August 2002. The annual survey comparesprices at online sites, including shippingcharges, with prices at traditionalstores in New York City. The survey foundthat savings were small or nonexistent forproducts like televisions and VCRs. However,experts say that huge savings can stillbe had on big-ticket products. They recommendvisiting price-comparison sitesbefore making such purchases.

Investor's

Business Daily

DealTime Ltd, a leading online comparison-shopping service, lets consumers pickthrough about 400 product categories tocompare prices and features, the notes. The company says ithas processed 30 million searches on its sitesince December 1, 2002 vs 12.5 million forthe same period in 2001.

Yahoo Inc also experienced an increasein traffic during the Christmas shoppingseason by including a last-minute gift centeron its site from December 12 toDecember 24. Traffic quadrupled vs lastyear, says P. K. Van Deloo, brand managerfor Yahoo Shopping.

BEYOND PRICE

New York Times

Besides low prices, consumers like theconvenience of shopping from home orthe office. And consumer concern aboutInternet security is declining, notes the, because many merchantshave instituted safeguards to protect creditcards and other personal data.

BizRate President Chuck Davis saysthat retailers are getting the messagethat the Web is fast becoming a preferredchannel for many consumers. Indeed, eretailershave gotten better at showcasingproducts on the Web, says MichelleDavid Adams, an analyst at comScore NetworksInc. "Retailers are making it easierto touch and feel their products in a virtualspace,"she said.