Free Shipping Boosts Online Spending

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NEW YORK (MainStreet) — This holiday season will likely go down as the time that people discovered the joys of online shopping.

Consumers spent more than $27 billion shopping online from the beginning of November through the end of last week, a 12% increase over the same period in 2009, according to a new report from ComScore, which tracks Internet data.

Much of this spending occurred on the major shopping days, including Black Friday, when consumers spent nearly $650 million online, and Cyber Monday, when online sales topped $1 billion for the first time ever.

However, the real success story of this holiday season has been free shipping.

On Free Shipping Day, a one-day event last Friday that featured more than 1,000 retailers which waived their shipping fees, consumers spent $942 million online, or nearly $400 million more than they did the year before.

“Free shipping has certainly become one of the prevalent themes of the 2010 holiday season,” said comScore chairman Gian Fulgoni, in a press release. “Since the week before Thanksgiving, we’ve seen the majority of online retail transactions use free shipping, which confirms the appeal of the offer for consumers. Free Shipping Day also appears to have driven a sustained late-season response, with free shipping transactions accelerating in importance in 2010 whereas they actually began to decline during the same period in 2009.”

In fact, last week, consumers spent $5.5 billion shopping online, by far the most of any week during the holiday season, and according to ComScore, the majority of all purchases made that week (52%) came with free shipping.

So, if there’s one lesson retailers can draw from this holiday season, it’s that consumers will buy more if they don’t have to worry about the shipping costs.

For those of you still finishing your holiday shopping (or just starting it), several major retailers, like Wal-Mart and Best Buy, are offering free shipping this week.

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