Society

Poll: U.S. Consumers Favor Amazon For Online Holiday Shopping

Employees of Amazon India are seen behind a glass bearing the company's logo inside its office in Bengaluru. Photo by REUTERS/Abhishek N. Chinnappa

A majority of U.S. consumers plan to go to Amazon.com for most of their online holiday shopping, according to a Reuters/Ipsos poll, even after traditional retailers have collectively spent billions of dollars to try to capture Web demand.

The survey of 3,426 adults conducted from Nov. 12 to 18 found that 51 percent plan to do most of their online shopping at Amazon this holiday season, compared to 16 percent at Walmart, 3 percent at Target and 2 percent at Macy's.

A little more than a quarter of respondents said they would use another retailer not listed in the poll (graphic).

The poll underscored the hurdles that traditional retailers faced in expanding online. Their own sales data this week showed that such efforts were falling short.

Target Corp said on Wednesday its digital sales grew 20 percent in the latest quarter, missing its expectations for a 30 percent gain. The discount retailer cited weakness in electronics demand.

A day earlier, Wal-Mart Stores Inc reported quarterly online sales growth of 10 percent, slower than its target growth in the mid-to-high-teens this fiscal year. Wal-Mart pointed to sluggish market conditions in China, Britain and Brazil, and said it fared better in the United States.

In contrast, Amazon.com Inc had posted a 28 percent jump in North American sales in its quarterly report last month.

"The Big Kahuna that continues to grab market share is Amazon," said Craig Johnson, head of retail consultancy Customer Growth Partners. "Both Wal-Mart and to some extent Target have simply not kept pace enough."

Johnson added that sluggish spending overall contributed to the weaker-than-expected online sales at Target and Wal-Mart, which also faced increased competition from other online retailers, such as Wayfair Inc.

According to the Reuters/Ipsos poll, 8 percent of adults said they plan to shop only online this year, compared to 6 percent a year earlier. The proportion of respondents who said they would shop mostly online remained steady at 17 percent.

All major retailers are investing in e-commerce.

Target said it has kept up the pace of investment in initiatives needed to grow its online business. In March, the retailer said it will invest $1 billion in improving its online sales technology and supply chain.

Wal-Mart is spending about $1 billion a year to bolster its e-commerce infrastructure. In the third quarter, it opened its fifth fulfillment center dedicated to online sales - establishing a network from which it said it could deliver to customers across the United States in two days.

For many shoppers, Amazon has become synonymous with online shopping. It gained tens of millions of members to its Prime service by offering access to movies, music and other services in addition to free shipping in return for an annual fee.

Amazon can also focus on online sales because it does not have to worry about getting customers into physical stores, said Kerry Rice, an analyst at Needham & Co.

"They drive you to that site in many, many ways," Rice said of Amazon. "It's not about driving foot traffic to retail stores."

The Reuters poll had a credibility interval, a measure of precision, of plus or minus 1.9 percentage points.

(Additional reporting by Nandita Bose; Editing by Peter Henderson and Tiffany Wu)

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