With the new year upon us, America Online (NYSE: AOL) is claiming that its more than 20 million members rang up $2.5 billion (US$) in sales this holiday season, a total that more than doubles last year’s figures.
The Dulles, Virginia-based online giant said that the total spent by its members at merchant sites on its Shop@AOL channel comprised 60 percent of the total online holiday spending that had been predicted by Internet analyst Forrester Research. The company also said that its members have spent a whopping $10 billion online this year.
Looking To 2001
“This holiday season was a banner shopping year for our merchants, but it’s just the beginning,” said AOL President Bob Pittman. “With the number of new buyers entering the category this holiday season, the strong economy that we are experiencing and consumer interest and satisfaction in online shopping hitting new highs, indications are that the e-commerce growth trend will continue through 2000.”
The company said that 2.5 million AOL members made their first online purchase this holiday season. The average buyer spent an estimated $300 in online goods and services and 95 percent said they would likely shop online again in the next six months.
Portal To Profits
The figures signal a rousing success for AOL’s shopping gateway, which was launched this past summer and features some 300 merchants.
The company said it used a number of innovative programming techniques to drive traffic to its merchants’ sites and that it offered merchandising and technical support to the merchants to prevent the kind of inventory, shipment and technical overloads that crippled many others during the height of the shopping season.
In addition, AOL said that its merchants support its 100 percent money-back guarantee of safety and satisfaction. This arrangement, the company said, soothed security concerns for first-time buyers and helped drive satisfaction levels up to the 95 percent level. Customer support via phone, Instant Messenger and e-mail was also a key ingredient in its success, AOL said.
AOL shoppers targeted many of the same products as brick-and-mortar shoppers, the company said. The top selling goods this Christmas were lingerie, toys, electronics, movies and music and athletic shoes and clothing.
The company said its shopping site — called the “Miracle Mile” by Forrester — reaches 70 percent of online consumers who use AOL brands every month. In addition to being available at AOL’s main portal, the shopping site is also accessible at Shop@Compuserve, Shop@Netscape, Shop@DigitalCity and Shop@Spinner.