Online Sales Surpassed $100 Billion in 2003

Online sales surpassed the $100 billion mark in 2003, according to an annual survey conducted by Forrester Research for Washington-based industry association The study also showed that online sales now represent 5.4% of all retail sales.

Among the fastest-growing product categories were online travel sales, which increased 91% over 2002 to $52.4 billion; home and office, which reached $11.1 billion in sales; and computer hardware and software, which hit $11 billion.

According to the report, online retailers on average broke even in 2002. For ’03, they raised operating margins to 21%. Among them, catalogers were the most profitable online sellers with 28% operating margins, up from 22% in ’02. What’s more, 79% of all online retailers were profitable last year, up from 70% in ’02. “Online retailing has arrived as a profit engine with double-digit operating margins,” Elaine Rubin, chairman of, which is a division of the National Retail Federation, said in a statement. “Retailers online have found the right balance between selling a product, acquiring and retaining customers, and earning a profit.”

For 2004, the study forecasts online sales to grow 27% to $144 billion. The biggest category gainers are expected to include health and beauty (61%), apparel (42%), and flowers, cards, and gifts (41% each). Online sales are forecast to reach 6.6% of total retail sales this year.

Partner Content

Hincapie Sportswear Finds Omnichannel Success in the Cloud - Netsuite
For more and more companies, a cloud-based unified data solution is the way to make this happen. Custom cycling apparel maker Hincapie Sportswear has leveraged this capability to gain greater visibility into revenue streams, turning opportunities into sales more quickly while gaining overall operating efficiency. Download this ecommerce special report from Multichannel Merchant to more.
The Gift of Wow: Preparing your store for the holiday season - Netsuite
Being prepared for the holiday rush used to mean stocking shelves and making sure your associates were ready for the long hours. But the digital revolution has changed everything, most importantly, customer expectations. Retailers with a physical store presence should be asking themselves—what am I doing to wow the customer?
3 Critical Components to Achieving the Perfect Order - NetSuite
Explore the 3 critical components to delivering the perfect order.
Streamlining Unified Commerce Complexity - NetSuite
Explore how consolidating multiple systems through a cloud-based commerce platform provides a seamless experience for both you, and your customer.