Rising food, gas prices may impact online sales
Many Americans are gearing up to spend more shopping online in 2012, but a significant portion of consumers will have to limit their ecommerce activities due to rising food and gas prices.
According to a new survey from PriceGrabber and Experian, approximately one in five Americans (21 percent) plans to spend more online in 2012 than they did in 2011. However, 28 percent said they may scale back their shopping budgets to better deal with rising food and gas prices. Meanwhile, half of Americans anticipate their online shopping budgets will remain unaffected, expecting to spend approximately the same amount of money as they did the previous year. Nearly 1,000 consumers participated in the survey between January 26 and February 13.
Those who intend to spend more are doing so in anticipation of an economic recovery. Of the people who said they had bigger ecommerce budgets, 36 percent said they were more confident in the economy and 30 percent are earning more money than they were last year. Additionally, 5 percent said they are now employed, which they weren't last year.
Among shoppers who plan to spend less, 40 percent blamed the higher prices of food, gas and other basic necessities. Compared to the group with larger budgets, 34 percent said they weren't confident in the economy, 29 percent are making less money and 16 percent spent too much during the 2011 holiday season and have to manage their expenses as a result.
With shoppers seemingly split between being cautiously optimistic and discouraged, PriceGrabber anticipates retailers will respond by offering discounts and other promotional efforts.
"We expect retailers will continue to roll out a number of tactics, such as free shipping, larger discounts and online-only promotions to help win the consumer dollar this year, while implementing strategies that will span bricks-and-mortar, online and mobile shopping platforms to entice consumers to shop," Graham Jones, general manager of PriceGrabber, explained.
After the 2011 holiday season, many retail merchants found they went overboard with promotions and discounts. Several had to revise their financial forecasts downward because of all the revenue lost due to rampant sales during November and December.
