Online shopping popular, but won’t save season

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ATLANTA (AP) — More Americans are deciding to shop online this holiday season instead of heading
to crowded stores.But that alone won’t save what is turning out to be a ho-hum Christmas for department
stores and clothing chains.Onlinesales have surged 9 percent so far this holiday season as Wal-Mart,Macy’s
and other retailers improved their web sites and prices to bettercompete with their online nemesis
Amazon.com. Meanwhile, shopping atphysical stores is up just 2 percent.Still, it’s estimated thatfor every
$9 shoppers spend in physical stores during the two-monthseason that ends on New Year’s Eve, they’ll only
spend $1 online,according to research firm comScore.Why? Retailers haven’t solvedmany of the challenges that
initially turned many shoppers off frombuying online. Some web sites still crash fairly frequently.
Hotmerchandise often sells out quickly online. And retailers haven’tconvinced people to use their shopping
apps on smartphones and tablets.Theselingering issues come from years of brick-and-mortar retailers
mostlyignoring the possibilities of online shopping while online giants likeAmazon got shoppers used to the
convenience of it. Solving theseproblems will help determine how retailers fare during the holidayseason and
beyond as shoppers increasingly buy online."The peoplethat are going to win …are the ones that are
there for the customerhowever they want to shop," said Joel Anderson, president and CEO ofWalmart.com,
Wal-Mart’s online business.The growing interest inonline shopping is evident this season. Sales were up 2
percent to$176.7 billion from Nov. 1 through last Sunday compared with the sameperiod last year, according
to ShopperTrak, a Chicago store datatracker. Meanwhile, online spending from home and work desktop
computerswas up 9 percent during the same period to $37.8 billion, according toresearch firm comScore.Still,
analysts say online shopping isn’t reaching its full potential because of a number of factors.SELLOUTS AND
CRASHESInthe early days of online shopping, frustrated shoppers often found theitems they wanted to buy
online were out of stock. In recent years,though, retailers have worked to boost their online inventory:
Forexamples, Wal-Mart Stores Inc., the world’s largest retailer, hasdoubled the number of items it carries
online this year to 6 million.Overall,retailers are better prepared than they were a few years ago to
fillonline orders via their inventory in store or in manufacturers’distribution centers, said Forrester
analyst Sucharita Mulpuru. But theystill have inventory problems that cause them to run out of
popularmerchandise, analysts say. And when that happens, retailers can losepotential sales.But inventory
isn’t the only problem thatcontinues to plague online shopping. Retailers have come a long waytoward fixing
some of the problems that caused their sites to crash andfreeze up in the early days of online
shopping.Crashes andslowdowns occur far less today than they did a few years ago, said AaronRudger, senior
manager web performance of Keynote, which monitorsretailers online performance. Keynote estimates that 23
percent ofretailers had web site problems during the official kickoff of theholiday shopping season, the
four-day Thanksgiving weekend, comparedwith 71 percent 5 years ago.But crashes still happen far moreoften
than they should, says Rudger, who found that the Motorola website crashed on the Monday after the four-day
Thanksgiving weekend knownas ‘Cyber Monday’ when it launched its Moto X phone. Urban Outfittersalso crashed,
he says. "Those are pretty well known brands so that to usis a bit of a surprise," Rudger
said.Those types of experiencescan turn off shoppers from buying online. For instance, Patrice GrellYursik,
34, wanted to buy a warm coat for her husband when she startedshopping online on Cyber Monday, but changed
her mind after she ran intotroubles on Macy’s web site."Macy’s had really great deals and Ihad an
awesome Michael Kors coat in mind but when I went to try to getit in black it was sold out," said the
style blogger who lives inChicago. "The site kept freezing and locking up, but by the time I triedit
again the coat was gone."That experience drove her ultimately drove her offline.Macy’ssays due to the
volume of traffic and shopping on Cyber Monday, therewere "rare occasions" when an item sold out
almost immediately after acustomer put it into their virtual shopping cart.GETTING SHOPPERS TO USE MOBILE
APPSThere’sevidence that Americans increasingly want to shop on their smartphoneand tablets this holiday
season. In fact, while mobile shopping accountsfor about 10 percent of online sales, it made up half of all
onlinetraffic during Black Friday weekend, according to IBM Benchmark, whichdid not give dollar amounts.But
more often than not, people areshopping on their smartphones and tablets using retailers’ web sites.That’s a
problem because having specific shopping app is important whenit comes to converting window shoppers into
buyers.That’s becauseapps are more streamlined than websites, which can be clunky and hardto navigate on
smaller screens on smartphones and tables. Also most appsstore shoppers’ information so customers don’t have
to type in a lot ofinformation each time they buy."One of the reasons people don’tconvert (to mobile
shopping) is that there is a lot of friction in theprocess," said Andrew Lipsman, vice president of
industry analysis forcomScore. "If I have to enter all my information on the phone, I mightnot convert.
But if there’s an easy log in and all I have to do isone-click or a couple of easy clicks to buy, people
will convert thatway."According to comScore data, Amazon and eBay are the onlymajor retailers that have
visitors spend more time on their app ratherthan their web site — by a wide margin. Meanwhile, only about 2
percentof time spent on Macy’s and Sears online presence is via an app,according to the data.The problem?
Analysts say retailers havenot marketed their shopping apps well enough to encourage shoppers tofind and
download them."Retailers should put specific incentivesin front of consumers to download and use that
app," Lipsman said."Doing that now will pay dividends down the road."Copyright 2013 The
Associated Press. All rightsreserved. This material may not be published, broadcast, rewritten
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