From Deseret News archives:

Generous incentives woo online shoppers

By Anne D'Innocenzio
Associated Press

Published: Monday, Nov. 27, 2006 9:42 p.m. MST

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ComScore, which excludes travel, auctions and corporate purchases in its results, expects online sales to increase by at least 24 percent to $599 million, from $484 million a year ago. ComScore reported a better-than-expected 42 percent increase in sales to $434 million on the day after Thanksgiving, from the same day a year ago.

The online shopping surge Monday follows a strong start to the holiday shopping season for brick and mortar stores over the Thanksgiving weekend.

One exception was Wal-Mart Stores Inc., which announced Saturday that November's same-store sales would be more disappointing than expected. The glum outlook sent its stocks down on Monday, as investors worried about the strength of the retail sector.

Nevertheless, analysts are expecting a robust holiday season for stores and in cyberspace, though business will be slower than a year ago.

The National Retail Federation expects total sales for the November and December period to be up 5 percent, but not as high as the robust 6.1 percent pace seen a year ago.

As for online holiday sales growth, JupiterResearch forecasts an 18 percent increase for online sales to $32 billion. That is slightly below the 23 percent pace in the previous year. Analysts are carefully monitoring the rivalry between online-only stores and brick and mortar stores, which are overtaking the lead in the online market share wars.

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According to comScore, from 2003 to 2005, sales growth for brick and mortar stores' online divisions grew twice the rate of that of online-only merchants.

Stores that operate both e-commerce sites and physical stores are realizing they can "use the Internet to not only sell product but also drive traffic to their stores," said Gian Fulgoni, chairman of comScore Networks.

Consumer electronics retailer Circuit City offered special coupons just for Monday as well as an additional $50 savings on home audio systems purchases of $400 and up.

The pure online players are fighting back with free shipping and other deals.