Online U.S. Sales to rise 18% to $259.1 billion in 2007

According to a recent report from Shop.org, U.S. online sales are expected to rise 18 percent to $259.1 billion this year. Sales, excluding travel, will reach $174.5 billion. In 2006, online sales rose 25 percent to $219.9 billion. Excluding travel, online retail sales rose 29 percent to $146.5 billion, representing 6 percent of total retail sales in 2006.

A surprising result of the research is that last year, for the first time, Americans spent more online on clothing than on computers, according to the first part of The State of Retailing Online 2007 study, which was conducted by Forrester Research.

Perhaps a sign that online sales are maturing in the U.S., and are of wide appeal, apparel, accessories, and footwear sales reached $18.3 billion in 2006 and are expected to hit $22.1 billion in 2007. This year, 10 percent of all clothing sales are expected to occur online.

According to Sucharita Mulpuru, Forrester Research senior analyst and lead author of the report, "The strong growth is an indicator that online retail is years away from reaching a point of saturation."

Another sign that e-commerce has come of age is that profitability throughout the sector has stabilized. Eighty-three percent of reported profitability and 78 percent said they were more profitable than 2005. Profit as a percentage of revenue did not change, the report notes, because revenue and expenses also grew.