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Business

Web stores are hurting

November 30, 2008

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For more than a decade, online retailers could count on big growth no matter the economic climate. But this holiday season, the e-commerce sector is at risk of its first slowdown since the Web was invented.

As bricks-and-mortar stores bemoan this season’s declining foot traffic, their Internet counterparts also are feeling the pain in ways they haven’t before.

Online retail spending fell 4 percent during the first 23 days of November from the same period last year, the industry’s first-ever drop, market research firm ComScore Inc. said this week. Shoppers shelled out $8.2 billion at U.S. Web stores, down from $8.5 billion last year.

“There’s never been a negative blip like this,” said Andrew Lipsman, a ComScore senior analyst. “This is really new territory for e-commerce.”

Whereas the Friday after Thanksgiving, known as Black Friday, is the crucial date for traditional shops, the following Monday, known as Cyber Monday, kicks off the online holiday-shopping season. That’s when buyers tend to take advantage of high-speed Internet connections at their workplaces to cross a few items off their shopping lists. Although online sales still account for less than 9 percent of overall retail sales, they had been a fast-growing channel.

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