Dreaming of an e-Christmas

And the most popular item on sale on the Internet? Satellite navigation systems for cars. So says research conducted separately by independent technology market researchers World Wide Worx and the shopping search site Jump Shopping.

“We expect the holiday season to contribute to at least 20% of the total R929 million expected to be spent online in 2007, with the proportion possible rising to as much as 25%” says World Wide Worx MD Arthur Goldstuck.

Gary Hadfield, CEO of online retailer kalahari.net, agrees. “Online retail in South Africa is experiencing continuous growth and the biggest retail sites have grown phenomenally when it comes to improving efficiency. Combine this with the penetration of broadband and online retail is set for major growth in the next few years,” says Hadfield. Kalahari.net recently won the Jump Shopping awards for best e-commerce store, best online book store and best jewellery and watch store.

Study of Internet shopping

World Wide Worx's study of Internet shopping, "Online Retail in South Africa 2007", confirms that consumers are beginning to gain confidence in online gift shopping.

“While it is clear that books, DVDs, CDs and electronics like iPods and satellite navigation devices are hot online this month, it depends on the quality of online retail sites which stores and items benefit the most.”

That's where the search engines play a role. Major search sites like Google and Ananzi will be the starting point for many shoppers, who will then often find themselves on specialised shopping search sites like Jump Shopping (www.jump.co.za).

“We can already see which products are generating the most heat through the searches on our site,” says Jump Shopping MD Albert Bredenhann.

Top product searches

The top product searches on jump.co.za are:

1. GPS (satellite navigation systems)
   
2. WII & Playstation 3 (games consoles)
   
3. iPod (MP3 player)
   
4. LCD monitors
   
5. Xbox 360 (games console)
   
6. HTC and Nokia (cellphones)
   
7. iPhone (Apple's iPod type phone, not officially on sale in SA, but available)
   
8. LCD TV (flat panel TV)
   
9. Games (all consoles)
   
10. Digital cameras
    

“It looks like it will be a gadget Christmas online,” says Bredenhann. “The great thing is that there is something for the whole family: LCD for dad, GPS for mom, game consoles for boetie, iPod for sussie, phone for grandma and digital camera for grandpa.”

The 2006 South African holiday season sales figure of R137-million represented 20% of total online retail in 2006, up from 16% of the total in 2005.

“This indicated a growing ability to fulfill late orders intended for the gift market,” says Goldstuck. “We expect more stores to get it right this year.”

This findings also confirm the significance of holiday season spending for online retailers, in line with the experience of physical retailers, and for the first time represents a dramatic increase over normal spending patterns. Since the holiday season covers just over five weeks, which represents about 10% of the calendar year, a figure of 20% of annual sales being achieved during this period suggests a potential doubling of sales over this period for many online retailers.