A Drive Through the Desert

When will we emerge from the recession, and what steps can you take to mitigate it?

Anyone who’s ever driven through the desert knows how rough it can be—mile after mile of bleak terrain with no end in sight, and just when you think it can’t possibly go on any farther…it goes on farther. Eventually though, the scenery starts to change, the terrain improves, and before you know it, the desert is a thing of the past and you’re on your way to greener climes.

The current terrain of online sales in the U.S. is a lot like that drive. Right now, we’re in the middle of our trip and the scenery is anything but idyllic, but even as we coast through that hot expanse, we know that eventually, we’ll start seeing signs of an improving landscape.

Light at the end of the tunnel?
Some economists have predicted that our current recession will end in 2009, which would be good news for everyone. According to the Retail E-Commerce Forecast published by e-Marketer, if the economists are correct, online sales will begin to rebound in 2010 and should hit their full stride in 2011. Online sales are predicted to experience 13.3% growth in 2011, and by 2013 online sales will reach a total of $201.4 billion—$69 billion more than in 2008.

Though sales growth continues to decline, online shoppers are hitting the e-stores in huge numbers. eMarketer predicts that roughly 152 million Americans age 14 and above will shop online in 2009, meaning nearly nine out of ten Internet users will browse, research or compare products this year.

But the economy is clearly changing users’ behavior in other ways. 2009’s shoppers are asking a lot more questions and doing a lot more research. Consumers in 2009 are getting increasingly more savvy when it comes to finding the best deals on the Web: seeking out coupons, discounts, product reviews, sites that don’t charge tax and just about anything that may save a buck or two.

Best practices for any economic environment
As we’ve repeatedly said, if you’re an advertiser who offers buyer incentives, be sure to let people know in your ads. Those buyers are out there, but as the desert heats up, they’re becoming more and more concerned with making the best deals possible. Even once we’re out of the desert, this will likely continue to be the case. Online shoppers have discovered the Internet’s power to find them the best deals, and tough economy or not, they’re going to keep hunting for them.

One last interesting thing about the forecast is eMarketer’s suggestion that the recession, while difficult, has really only accentuated the gradual decline in online sales growth over the past few years. In other words: The recession may have been inevitable and unavoidable. Online sales have simply grown so big over the past few years that maintaining high levels of growth became almost impossible.

While we don’t know exactly when, we do know that we’re headed out of the desert. In the meantime, we’ve got some hard driving ahead. Use all the methods at your disposal to keep cool.

— Noah Belson, Content Quality Analyst

Photo courtesy of Flickr user Sara Atkins