Shoppers are headed online this Christmas, but that doesn't mean they're in the gift-giving mood.
A new study from Jupiter Communications says that although online spending is expected to double this year -- hitting $US2.3 billion -- only about 16 percent of those purchases will be gifts.
"While online retailers have been successful in capturing dollars that consumers spend on themselves, they have been unsuccessful in getting the majority of those same customers to spend their gift dollars online," said Jupiter analyst Nicole Vanderbilt.
Gift-giving is a perfect way to take exploit the Internet, Vanderbilt said, by letting users set up online registries and tracking who buys what. While a few companies have created the registries, no one is taking full advantage of the technology, she said, or even separating out purchases made for gifts.
Online sites not gifted at gifts
"Even someone like Amazon.com doesn't quite understand the full potential for the gift market," she said.
And mainstream retail brands -- many of which are just starting to get online -- will be even further behind, she said.
"They're the dinosaurs when it comes to profiling," she said. "They don't have an ability to track individual behavior the way a cataloger or online retailer does."
But they are at least getting online, a big switch from last year.
Retailers go online
One reason more shoppers are headed online is that many of the big name, mainstream retail brands have finally set up shop on the Internet.
Analysts say one of the biggest success stories is the Gap, which opened its online shop last year. The company debuted new sites for its Baby Gap and Gap Kids stores, and launched an ad campaign specifically targeting its online stores.
Vanderbilt applauded the way the Gap is using its retail stores to plug its Web site. She contrasted it to Barnes and Noble, which has held off using its stores aspromotional vehicles because of tax issues.
"They didn't utilize the key core asset they have over Amazon. The Gap, by promoting its online stores in its existing stores, is utilizing that asset well," she said.
The Gap's success has been noted by others. In particular, Levi Strauss & Co, which will debut an online store for jeans and its Dockers brand later this month. And upscale makeup manufacturer Clinique will begin selling blush and lipstick online in November as well.
Retailers need to wake up
Vanderbilt says those stores are interesting because in both cases, the manufacturer will be selling directly to the customer, without going through a department store or other retailer.
"It's a classic example of a supplier having to go direct because their retail partners haven't been aggressive in going direct," she said. "They can peacefully co-exist. But it's a wake-up call [to the retailers] so they don't lose business to the online market."
The department stores are picking up the pace, however. Both Macy's and Nordstrom's have launched online shops during the past year.
