State of the U.S. Online Retail Economy in Q2 2010

State of the U.S. Online Retail Economy in Q2 2010

Gian Fulgoni, Chairman, comScore, Inc.
Note: A copy of this presentation will be sent to all attendees within 24 hours of
today’s webinar

Data sourced from comScore’s global panel of 2 million Internet
users

°
360°View of Consumer Behavior Analysis Parameters

E-commerce data includes all worldwide buying on U.S.
sites

Unless explicitly stated otherwise, the term e-commerce
refers to online retail spending, which excludes travel,
autos and auctions

Behavioral activity through July 2010

Survey issued in July 2010, n=1086

Consumer Measurements:
– Site Visitation
– Online Buying
– Video Viewing
– Attitudes and Intentions
– Behavioral Segments

Retailer Views:
– Large vs. Small Retailers
– Multi-Channel vs. Pure-Play Retailers

© comScore, Inc. Proprietary and Confidential. 2

Validation of comScore Sales Data:
Comparison of comScore data to U.S. Department of Commerce

Quarterly U.S. e-Commerce Sales* ($ Billions) Quarterly U.S. e-Commerce Growth* vs. YA
Source: comScore & U.S. Department of Commerce (DOC) Source: comScore & U.S. Department of Commerce (DOC)

50 Dept. of Commerce (DOC) comScore Estimate of DOC Dept. of Commerce (DOC) comScore Estimate of DOC

45 35.0%
40 30.0%
Correlation: 0.96
35 25.0%

% Growth vs. YA
30 20.0%
Billions ($)

25 15.0%
20 10.0%
15 5.0%
10 0.0%
5 -5.0%
0 -10.0%
2005 - Q1
2005 - Q2
2005 - Q3
2005 - Q4
2006 - Q1
2006 - Q2
2006 - Q3
2006 - Q4
2007 - Q1
2007 - Q2
2007 - Q3
2007 - Q4
2008 - Q1
2008 - Q2
2008 - Q3
2008 - Q4
2009 - Q1
2009 - Q2
2009 - Q3
2009 - Q4
2010 - Q1
2010 - Q2

2005 - Q1
2005 - Q2
2005 - Q3
2005 - Q4
2006 - Q1
2006 - Q2
2006 - Q3
2006 - Q4
2007 - Q1
2007 - Q2
2007 - Q3
2007 - Q4
2008 - Q1
2008 - Q2
2008 - Q3
2008 - Q4
2009 - Q1
2009 - Q2
2009 - Q3
2009 - Q4
2010 - Q1
2010 - Q2
*Note: To be consistent with DOC, comScore estimate excludes
© comScore, Inc. Proprietary and Confidential. 3 travel and event tickets but includes auction fees and autos.

Following a soft 2009, total e-commerce sales through Q2 2010 were up
7% versus year ago. Travel and non-travel up 5% and 9%, respectively.

e-Commerce Dollar Sales Growth ($ Billions)
Source: comScore e-Commerce Measurement

+7% +7%
+17% -2%

+19% $214 $209
+22%
$200
+26%
$171
+9%
$84 $80 -5%
+29% $143 $77 +12%

$117 $69 +13%
$111
$93 $61 +20%

$72 $51 +28% $44 +5%
+6%
Travel $40 +33% 0%
$30 +24% $123 +20% $130 $130
+24% $102
Non-
+26% $67 +26% $82 $67 +9%
Travel
$42 $53

2002 2003 2004 2005 2006 2007 2008 2009 YTD
2010
2010
YTD


Positive growth returned in 2010, with notably strong growth rates in
March & April, a possible result of heavier promotion activity in
Spring of 2010

Monthly e-Commerce Sales Growth vs. YA ShopLocal Index of Weekly Offers Per Store
Source: comScore e-Commerce Measurement Source: ShopLocal
Month Growth Rate vs. YA 400
2009 2010
January 2010 +7% 350
February 2010 +4%
300
March 2010* +17%
April 2010 +12% 250
May 2010 +8%
200
June 2010 +7%
July 2010 +9% 150
*March saw an additional bump in activity due to timing of Easter in 2010 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31
Week

For January through July 2010, non-US residents accounted for 6.6% of
ecommerce sales at U.S. sites

Note: International contribution is defined as the percent of e-
commerce sales made on U.S. sites by consumers residing outside
of the U.S. It excludes U.S. sites with non-U.S. addresses (e.g.
amazon.co.uk).

After two quarters of accelerating sales, e-commerce growth
plateaued in Q2

Quarterly e-Commerce Sales Growth vs. YA

23% 23%
25%
17% 19%
20%
15% 11% 13%
10% 9%
10% 6%
3%
5%
-3% 0% -1% -2%
0%
Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10
-5%

Quarterly Retail & Food Services Sales Growth* vs. YA
Source: U.S. Department of Commerce (DOC)

When excluding autos,
7%
10% gas and food/beverage, Q2
6%
4% 4% 5% 4% retail sales growth was
5% 3%
2% 1% marginally softer at +6% 2%

0%
Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10
-5%

-10% -8% -7%
-9%
-15% -10%
*Note: The U.S. Department of Commerce calculation includes total
© comScore, Inc. Proprietary and Confidential. 6 retail and food service sales, which also includes motor vehicles and
parts dealers.

e-Commerce continues to gain share of retail spending on an apples-
to-apples basis

e-Commerce Share of Corresponding Retail Spending*
Source: comScore for e-Commerce & U.S. Department of Commerce (DOC) for Retail

9.0%
8.1%
8.0%
7.4% 7.3% 7.6% 7.7% 7.7%
7.1%
7.0% 6.7%
e-Commerce Share

6.9%
5.9% 6.8%
6.0% 6.4% 6.3% 6.5% 6.6%
5.1%
Commerce

5.9%
5.0% 5.3% 5.3%
4.3% 5.0%
4.6% 4.5%
4.0% 4.3%
4.0%
3.0%
3.7% e-Commerce share peaks in
colder seasons (Q4 & Q1)
2.0%

1.0%

0.0%

*Note: e-Commerce share is shown as a percent of DOC’s Total
Retail Sales excluding Food Service & Drinking, Food & Bev. Stores,
Motor Vehicles & Parts, Gasoline Stations and Health & Personal
© comScore, Inc. Proprietary and Confidential. 7 Care Stores.

Lower-and-upper income segments are drivers of online growth in Q2 2010,
but the large mid-income segment shows no growth and is down versus pre-
recession periods two years ago

e-Commerce Sales vs. YA by Income Segment
Bracket Contribution of Total
Income Segment Online Retail Spending Online Retail Spending Share of
e-Commerce Growth
Growth in Q2 ‘10 vs. Q2 ‘08 Growth in Q2 ‘10 vs. YA Spending
in Q2 ‘10 for Q2 ‘10

Online Retail
Income Segment
Under $50,000 +14% +22%
Online Retail 22% +5%
Spending
$50,000 - $99,999 -8% -2% 41% -1%

$100,000 or more +28% +17% 37% +6%

Total +8% +9% 100% +9%


Worries of double-dip recession are mounting, stoking fear among
consumers

“The recovery just isn’t looking
that great. The job market has lost
some positive momentum. This
suggests another weak reading on
consumer spending in the third
quarter.”
– Julia Coronado, Sr. Economist at BNP
Paribas, August 13, 2010

“With unemployment at 9.5%, people in
the U.S. are worried about the recovery.
And a record string of 22 straight
federal government budget deficits has
raised fears of higher taxes. Caution by
Americans over their finances means
higher saving, which restrains
spending.”
– Wall Street Journal, August 12, 2010


The ‘Scariest Jobs Chart Ever’ is beginning to look even scarier

% Job Losses Relative to Peak Employment Month in Post WWII Recessions
Source: CalculatedRiskBlog.com

Number of Months After Peak Employment


An increase in pessimism regarding the unemployment rate
coincides with findings from the Pew Research Center showing the
surge in long-term unemployment

Q. When do you think the unemployment rate will
begin to improve?
Source: comScore Surveys - April & July 2010

63%
+10% vs.
April 2010

22%

10%
4%
1%
The typical unemployed worker today has been out
More Than Next 7-12 Next 4-6 Next 2-3 Next of work for nearly six months or 23.2 weeks. This is
12 Months Months Months Months Month almost double the previous post-World War II peak
From Now for this measure –12.3 weeks – in 1982/83.
– Pew Research Center


Unemployment remains the top concern among consumers; financial-
market concerns have risen, especially among the upper-income
segment

Percent of Respondents Citing Their One Most Important Issue
Q. Based on your current situation, which one of the following economic conditions
most concerns you?
Source: comScore Surveys - October 2009 & January, April & July 2010

Rising Unemployment/ Financial Real Estate/
Prices Job Security Markets Home Values
Oct Jan April July Oct Jan April July Oct Jan April July Oct Jan April July
09 10 10 10 09 10 10 10 09 10 10 10 09 10 10 10

Total 32% 29% 33% 30% 42% 50% 42% 44% 13% 9% 10% 13% 8% 7% 9% 8%

Household Income

$100K or more 19% 22% 23% 13% 34% 44% 34% 45% 27% 13% 17% 26% 15% 17% 18% 13%

$50K-$99,999 28% 23% 26% 22% 43% 50% 49% 46% 13% 12% 11% 16% 12% 10% 11% 11%

Under $50K 39% 36% 41% 40% 42% 50% 39% 42% 9% 6% 7% 9% 4% 4% 5% 6%


76% of consumers have changed how they spend money based on
the recession and 43% of them say these changes are permanent

Lifestyle Changes Based on Recession
Q. Have you changed how you spend money based on the recession?
Q. In what ways have you changed how you spend money, based on the recession?
Source: comScore Survey July 2010

76% Eating at home instead of eating out 80%
Only making planned purchases 69%
Reducing entertainment expenses 67%
Using cash/debit card/checks instead of credit
cards 54%
24%
Sticking to a personal budget 48%
Changing travel plans 42%
Yes No Changing driving habits 33%
Reducing or canceling cable/Internet plans 23%
Reducing or canceling cell phone plans 21%
43% of these consumers say
Changing living arrangements 14%
these changes are permanent
and will be continued even Other 2%
when the economy recovers None of these 0%

% of those who changed how they spend money based on the recession


76% hold a pessimistic view of current economic conditions;
3 in 10 predict conditions will worsen in the future

Consumer Agreement with Economic Statements
Q. Which statement best describes how you feel about the current economic conditions?

“We haven’t hit bottom yet; the worst is still to
come.” 29%

“We’ve turned the corner, but I would not be
surprised if the economy dropped again before it 21% Pessimistic 76%
fully recovers.” Chg from Q1 (+3%)

“We might be headed in the right direction but the
signs of improvement are hard to see.” 26%

“The economy is stagnant, not going up or down.” 16%
Neutral/Positive 24%
Chg from Q1 (-3%)
“We’ve turned the corner and are beginning to see
signs of improvement.” 8%

% of All Respondents


Who is Today’s Online Consumer?


The average heavy online buyer spent $615 in Q2 2010, nearly 5X
more than medium buyers and 20X more than light buyers

Key Shopping Metrics for Heavy/Medium/Light Buyer in Q2 2010

Heavy Medium Light
% of Buyers 20% 30% 50%

% of e-Commerce Dollars 69% 22% 8%

% of Transactions 40% 30% 30%

Dollars per Buyer $615 $133 $30

Transactions per Buyer 4.7 2.4 1.4

Amazon Attracts a Higher Proportion of Heavy Online Buyers
Amazon %
% CHG in
Buyer Reach Composition
Segment
Within
Reach vs.
Amazon
Amazon reaches a
Q1 2010 third of heavy
Segment Buyers
online buyers, up 3
Heavy 34% +3 points 28%
percentage points
Medium 25% 0 points 31% from Q1 2010
Light 20% 0 points 41%
H/M/L Definition:
Heavy = Top 20% of buyers based on dollars spent in Q2 2010
Medium = Next 30% of buyers based on dollars spent in Q2 2010
© comScore, Inc. Proprietary and Confidential. 16 Light = Bottom 50% of buyers based on dollars spent in Q2 2010

The leading ten retailers within the heavy e-commerce buyer segment
are split between multi-channel and pure-play retailers, but Amazon
leads the pack with 10% share

Top 20 Selected Retailers by Share of Heavy Buyers’ Dollar Spending in Q2 2010

Share of Heavy Buyers
Top Retailers
Dollar Spending
Amazon 10%
Dell 8%
Staples 4%
Costco 4%
Walmart 3%
Ticketmaster 3%
QVC 3%
Apple 3%
Office Depot 2%
HSN 2%
JCPenney 2%
Quill 2%
Best Buy 2%
Sears 2%
Tiger Direct 2%
Victoria’s Secret 2%
Stub Hub 1%
Home Depot 1%
Target 1%
Gap 1%


Six in ten consumers say the Internet has become important when
making buying decisions and 59% of them say it has increased in the
past year
Importance of the Internet in Making Purchasing Decisions
Q. In the past 3 months, how important has the Internet become in providing
you with information to help you make buying decisions?
Q. How has this changed versus a year ago?
Source: comScore Survey – July 2010

31%
59%

59% 16%
Significantly Increased
10% Somewhat Increased
43%

% of those who found the Internet important
Slightly/very important
Slightly/very unimportant
Neither important nor unimportant


Consumer loyalty to specific retailers and brands has steadily
decreased over the past two years, while likelihood to shop online for
deals has risen

How Consumers Are Cutting Shopping Expenses
Q. Please indicate how you are cutting your shopping expenses
Source: comScore Surveys – July & October 2008, April 2009, April & July 2010

July Oct April April July % Chg
(07/08 to 07/10)
2008 2008 2009 2010 2010
Reducing gift spending 41% 51% 59% 57% 56% +15%
Shopping at different retailers 20% 25% 30% 33% 32% +12%
Buying different brands (including generic brands) 52% 51% 58% 57% 62% +10%
Shopping online for deals 24% 25% 33% 32% 32% +8%
Signing up for retail point programs or customer loyalty
22% 22% 27% 29% 29% +7%
programs
Using coupons more often when making purchases 59% 62% 68% 64% 66% +7%
Shopping only when there are sales (i.e. one day
40% 43% 41% 43% 44% +4%
sales)
Shopping at secondhand stores, garage sales, etc. 30% 33% 30% 31% 33% +3%
Shopping less frequently 68% 71% 70% 72% 69% +1%
Buying in bulk at warehouse/discount retailers like
27% 28% 31% 28% 28% +1%
Costco, Sam`s Club, BJ`s etc.
Shopping at auction sites such as ebay.com 13% 14% 14% 13% 13% 0%
Only shopping for basic necessities 66% 67% 60% 62% 65% -1%


Amazon has the largest audience with 76 million UVs in Q2 2010; it’s
one of the fastest growing sites in the category, second only to
Netflix

Average Monthly Unique Visitors (MM) and % Growth vs. YA
on Selected Retail Sites in Q2 2010
Source: comScore Media Metrix

Retail Sites 168.7 +13%

Amazon Sites 76.2 +21%

Apple.com Sites 40.2 +15%

Walmart 34.9 +5%

Target Corporation 26.1 -3%

Netflix.com 19.0 +34%

Best Buy Sites 16.7 +8%

Hewlett Packard 14.8 +6%

The Home Depot, Inc. 13.1 +8%

JC Penny Sites 12.0 -3%

Sears.com 11.0 +1%


Pure-play retailers have gained market share over the past two years.
Multi-channel retailers have lost share

Multi-channel vs. Pure-play: Share of Quarterly U.S. e-Commerce Sales
Source: comScore

100%

90%

36.0%
80% 42.5% 40.1% 41.3%
47.2% 44.3% 44.8% 44.6%
51.1% 48.6%
70%

60%

50% Multi-Channel
Pure-Play
40%

64.0% 58.7%
30% 57.5% 59.9%
52.8% 55.7% 55.2% 55.4%
48.9% 51.4%
20%

10%

0%
Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010


Larger retailers continue to benefit from leveraging deeper discounts,
free shipping incentives and inventory, garnering an additional 5.6
share points from Q2 2009

Share of Sales for Top 25 Retailers in Q2 2010 vs. YA

Point Change
Sales Share Q2 2009 Q2 2010 vs. YA
Q2 2010

Total E-Commerce 100.0% 100.0% N/A

Largest 25 Retailers 59.8% 65.4% +5.6 pts

All Other Retailers 40.2% 34.6% -5.6 pts

Share Shifts
Q2 2010 vs. YA Q1 2010 vs. YA Q4 2009 vs. YA
Largest 25 Retailers +5.6 pts +3.6 pts 4.2 pts
All Other Retailers -5.6 pts -3.6 pts -4.2 pts


Women are more avid online buyers than men, making up 58% of
total dollars spent and 61% of online transactions

In the U.S.,
12.5% of female 58.2%
Internet users made 61.1%
an online purchase
in February 2010, Women

compared to 9.3% Men

of men.

41.8% 38.9%

Dollars Transactions
U.S. Consumers, Non-Travel Internet Purchases, February 2010
© comScore, Inc. Proprietary and Confidential. 23 Source: comScore e-Commerce Report

60% of buying on multi-channel sites is attributable to women,
whereas the distribution on pure-play sites is more evenly split

Propensity to Buy on Multi-Channel vs. Pure-Play Retailer Sites by Age and Gender
% of Total Dollars Spent by Segment in June 2010

Multi-Channel Retailers Pure-Play Retailers
Women Men Women Men

Age <34 19% 14% Age <34 12% 14%

Age 35-54 28% 19% Age 35-54 24% 22%

Age 55+ 13% 7% Age 55+ 17% 11%

Total 60% 40% Total 53% 47%

Multi-Channel: Utilizes more than one channel to conduct business (e.g. Best Buy)

Pure-Play: Utilizes a single channel to conduct business (e.g. Amazon)


Most product categories showed sales growth versus year ago.
Consumer electronics and computers have shown strength
throughout 2010
Q2 2010 e-Commerce Sales Growth vs. YA by Retail Category

Category Change vs. YA
Strong
CONSUMER ELECTRONICS (x PC PERIPHERALS)
Strong
COMPUTERS / PERIPHERALS / PDAs Out-Performing Total Internet
Strong (Growth rates of 9% or higher)
BOOKS & MAGAZINES
Strong
VIDEO GAMES, CONSOLES & ACCESSORIES
Moderate
JEWELRY & WATCHES
Moderate
HOME & GARDEN
Moderate
FURNITURE, APPLIANCES & EQUIPMENT
Moderate Under-Performing Total Internet
CONSUMER PACKAGED GOODS
(Growth rates of 1%-8%)
Moderate
FLOWERS, GREETINGS & MISC GIFTS
Moderate
OFFICE SUPPLIES
Moderate
EVENT TICKETS
Flat Flat/Negative
APPAREL & ACCESSORIES
Weak Growth
SPORT & FITNESS


The Impact of Promotions & Price Incentives on
Internet Behavior


Comparison Shopping sites, such as Nextag and Shopping.com,
have gained visitors and increased time spent on their sites
Unique Visitors (000) to Comparison Shopping Sites
85.5 Million in Jul ‘10
90,000 +30% vs. Jul ‘08
85,000
80,000
75,000
70,000
65,000
60,000
55,000
50,000

Total Minutes (MM) Spent on Comparison Shopping Sites
600
550 440 Million in Jul ‘10
500 +51% vs. Jul ‘08
450
400
350
300
250
200


Coupon sites continue to grow in importance; category visitors tend
to skew slightly older and female

Total Unique Visitors (000) and Total Visits (000) to Coupon Sites
Source: comScore Media Metrix 101.1 million visits
120,000 +56% vs. Jul ‘08
100,000

80,000

60,000 34.5 million UVs
+34% vs. Jul ‘08
40,000

20,000

0
Jul-2008 Sep-2008 Nov-2008 Jan-2009 Mar-2009 May-2009 Jul-2009 Sep-2009 Nov-2009 Jan-2010 Mar-2010 May-2010 Jul-2010

Total Unique Visitors (000) Total Visits (000)

UV Composition Index by Income UV Composition Index by Gender

Under 97
$60K
Females 114
$60K - 101
$74,999

$75K - 104
$99,999
Males 86
$100K 104
or more


Coupons.com, which leads the Coupon category in terms of UVs,
reports $1 billion in redemption value in first half of 2010

Top Coupon Sites by Unique Visitors (MM)
“[Coupons.com] said savings from July 2010
coupons printed out or loaded to a loyalty Source: comScore Media Metrix
card from its online properties doubled to
more than $1 billion from $529 million a Coupons, Inc. 7.2
year ago. The value of savings in June
alone hit $110 million, the highest total to LivingSocial* 6.8
date for any single month via
Coupons.com.” (MediaPost, July 2010)
Groupon.com 5.3

RetailMeNot.com 4.4

EverSave.com 4.0

eBayCoupon.US 2.4

RebateGiant.com 2.2

With only 2.2 million UVs, MyPoints Sites MyPoints Sites 2.2
generated 14.5 million visits or an average
of 6.6 visits per visitor in July 2010.
CouponMountain.com 1.6

CouponCabin.com 1.4

*Note: LivingSocial is currently included in the Social Networking category
within comScore Media Metrix. For the purpose of this analysis, it has been
© comScore, Inc. Proprietary and Confidential. 29 included in the above Coupon ranking.

Flash Sale sites continue to gain traction with high growth rates
versus year ago, although we’re seeing a slight slowdown during the
summer months

U.S. Unique Visitors to Flash Sale Sites

2000

1800

1600

1400

1200
HauteLook
1000 +12% vs. July ‘09
Ideeli
800 +382% vs. July ‘09

600 Gilt
+46% vs. July ‘09
400
RueLaLa
200 +15% vs. July ‘09

0

HAUTELOOK.COM IDEELI.COM GILT.COM RUELALA.COM


Group buying is surging. Groupon.com and LivingSocial continue to
execute against strategies that enhance the user experience and
entice consumers from across the Web
U.S. Unique Visitors (000)
8,000 LivingSocial.com
7,000 +8300+% vs. YA

6,000
5,000
4,000
Groupon.com
3,000 +3300+% vs. YA
2,000
1,000
0

LIVINGSOCIAL.COM GROUPON.COM

19% of UVs to Living Social
are sourced from Evite and
15% from Facebook.
Source: comScore Media Metrix, July 2010


Half of consumers say they’ll abandon their shopping cart if free
shipping isn’t offered, a quarter will only buy when free shipping is an
option and 90% won’t pay more than $10

51% of consumers are at least ‘somewhat likely’ to cancel their entire purchase
if free shipping is not offered.*

Q. In general, how much are you willing to pay for shipping on a purchase made online?
Source: comScore Survey – July 2010

I only purchase items with free shipping 23%
Between $0.01 and $4.99 47%
Between $6 and $9.99 20%
More than $50 0%
Shipping charges do not matter to me 4%


*Q. If you reached the end of your online checkout and found that
free shipping was not offered, how likely would you be to cancel your
purchase? (comScore Survey, July 2010)

Special pricing, future discounts and rewards/incentives are
appealing alternatives to free shipping for consumers

Free Shipping Alternatives
Q. If free shipping was not offered on an order, which of the following would make you more
likely to continue with your purchase anyway?

Special pricing on items 54%

Discounts on future purchases and/or Reward Points/Incentives 31%

Faster shipping 16% 66% would be more likely to
continue their purchase if
special pricing or
Money back through branded credit card offers 11% discounts/rewards on future
purchases were offered

Not sure 13%

None of these 16%


Other Digital Trends Retailers Can’t Afford to Ignore


Facebook monthly UVs now over 145 million in the U.S. while
MySpace still reaches 60 million – more people than any single multi-
channel retailer site

Number of Unique U.S. Visitors (000) to Facebook.com and MySpace.com

+66% in July 2010
150,000 vs. YA
Unique Visitors (000)

130,000

110,000

90,000
-11% in July 2010
vs. YA
70,000

50,000

In May 2009, Facebook surpassed MySpace for the first time in terms of total U.S. UVs, and the site is
continuing to experience explosive growth, now35with more than 2X the monthly UVs of MySpace.
© comScore, Inc. Proprietary and Confidential.

On fixed Internet, Retail sites and Search have a comparable reach,
however, with Smartphones and Mobile, Search’s reach is about 3X
and 5X greater than Retail sites, respectively

% Reach for Search and Retail On Fixed Internet, Smartphone & Mobile
Source: Media Metrix + MobiLens, June 2010

88.8%
78.3%

51.2%

15.8% 19.6%
5.6%

Internet Smartphone Mobile

Retail Search


Among Smartphone users, only 10% have purchased physical items via
their phones. On average, these users spent $121 in the last 3 months
In the past 3 months, approximately how much Average dollars % of
money have you spent on each of the following spent (among Smartphone
Q. Do you own or use a smart types of digital content via a mobile device, those who users who
phone or digital media device, Smartphone or other wireless device? purchased) purchased
such as an iPhone, iPad, Droid, Movies/videos/TV shows $28 13%
Blackberry, Kindle or similar Games $24 17%
device? Music $19 17%
Source: comScore Survey July 2010 Kindle books $15 9%
Applications $10 14%
Other type of e-book $10 7%
Ringtones $7 9%
Wallpapers/graphics $7 6%
22% Other digital content $5 5%
Average dollars % of
In the past 3 months, approximately how much
spent (among Smartphone
money have you spent on each of the following via
those who users who
a mobile device or Smartphone?
purchased) purchased

78% Physical items purchased from a retail site $121 10%

Physical items purchased from an auction site $52 7%

‘Deal of the day’ sites $48 8%

Renewing or recurring website expenses $23 9%

Yes No Renewing subscriptions to online services $22 9%
Other physical/subscription purchase $2 2%


Twitter experienced explosive growth in early 2009, which has since
leveled off at about 20+ million monthly UVs. API usage likely means
that actual monthly users are somewhat higher

Total Unique Visitors (000) to Twitter.com
Source: comScore Media Metrix Media
24.8 million UVs
30,000 +17% vs. July ‘09 &
+3066% vs. July ‘08
25,000
Unique Visitors (000)

20,000

15,000

10,000

5,000

0


22% of Twitter users follow businesses to find special deals,
promotions or sales

Consumer Usage of Twitter
Q. For which have you used Twitter?

Reading tweets from users I follow 44%
Posting my own tweets 33%
Conversations with other users 24%
Following businesses to find sales/deals/special prices/promotions 22%
Finding breaking news 21%
‘Retweeting’ other users’ tweets 20% 29% of Twitter users
in total use the
Following celebrities 17%
service for retail-
Finding political news 15% related purposes
Finding product reviews/opinions 14%
Following my favorite sports teams 11%
Asking for help/advice from other users 9%
Other 4%
None of the above 16%

% of Twitter users


The Use of Video in Retail


Retail video – a quick overview

July July % Chg
2009 2010 vs. YA

Number of people who
watch video on retail 41MM 58MM +40%
YOY growth in retail sites each month
video viewers (40%)
significantly % of retail site visitors
outpaced growth who also viewed video 28% 34% +18%
in total video viewers (17%)
onsite

Source: comScore Video Metrix Total # of viewed
174MM 311MM +79%
videos

Viewing time per
11mins 20mins +82%
person

% reach total US
14% 20% +43%
population


Adding video to retail sites is extremely powerful

Buying Power Index
Source: comScore Video Metrix 2.0, June 2010

250
Retail site visitors who also
view video are 64% more
200
201 likely to purchase

150 137 Retail site visitors who also
view video spend 2 minutes
115
100 longer onsite per visit
100

50

0
Total Total Internet Retail Site Retail Site
Internet w/ Video Visitors Visitors w/
Video Viewing


Nearly 100% of online spenders are video viewers

Non-Video
Viewers
4%

Video Viewers
96%

© comScore, Inc. Proprietary and Confidential. 43 Source: comScore Video Metrix 2.0, June 2010

Video advertising is significant in terms of online audience reach

63% of the online audience is
currently reached by
video advertising each month

83% of all online
spending comes from
them


Video advertising is increasingly important in terms of impact

83% of all online spending comes from these
video viewers who have seen a video ad


Not all video audiences are created equal when it comes to video
advertising and retail spending at a category level

Buying Power Index
Source: comScore Video Metrix 2.0, June 2010

170
180
136 145
160
140 115
120
100
80
60
40
20
0
Total Video Sites Video Ad Network Earned Media & Long Format TV
Category Social Video


Tips for Retailers Considering Video

For key products with important and detailed benefits, adding video to your
site can encourage people to spend more time on your site and ultimately
to make a purchase
– Remember, almost all online spenders are video viewers and retail site visitors
who view video are 64% more likely to make a purchase
When adding video to your site or on sites like YouTube, ensure your
videos are easy to find and have detailed metadata tags for search visibility
– this will help your video cut through the clutter to reach your target
audience
Video advertising on premium and social video sites like Hulu and
YouTube can help you reach people who are much more likely than typical
Web visitors
– It’s definitely worth considering for high value products, branding or important
launches


comScore Holiday Season Retailer Report

Track the performance of your site versus your competitors’ during the
holiday season and get answers to important questions such as:
How does my audience size and that of my competitors’ vary day to day throughout
the holiday season?
What are my peak traffic days? What retailers are leading in terms of audience
size?
To what extent are retailers leveraging free shipping?
How effective is my site compared to the competition at converting visits into
transactions and how does that compare with site averages across the Internet?
How qualified is the traffic at each of the competitive domains as well as my own?
To what extent is my site and my competitors’ sites penetrating the online buyers
and how does that compare to last holiday season?

For more information:
Jenn Vlahavas
jvlahavas@comscore.com
1-312-775-6628

QUESTIONS?

Please contact us at learnmore@comscore.com if you have any
additional questions or comments.


Thank You!
Note: A copy of this presentation will be sent to all attendees within 24
hours of today’s webinar.

Want more insights? Follow us on Twitter!
http://twitter.com/gfulgoni
http://twitter.com/comscore

State of the U.S. Online Retail Economy in Q2 2010

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