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U.S. Online Retail Sales Expected To Double In Six Years

Online retail sales in the U.S. are expected to double by 2010, accounting for 12 percent of the total retail sales, a market research firm said Monday.

Sales are expected to reach $316 billion in six years and increase to 12 percent from 7 percent in total sales this year, Forrester Research said.

On Friday, the Commerce Department said online retails sales for the second quarter were up 23.1 percent from the same period a year ago, rising to $15.7 billion from $12.7 billion. E-commerce sales accounted for 1.7 percent of total retail sales, which was slightly higher than the 1.5 percent reported a year ago.

Forrester said the growth in online sales will be fueled by more consumers moving from dial up to broadband connections, and retailers improving their coordination between online and in-store operations, enabling consumers, for example, to buy online and pickup at a store or return Internet-purchased products at retail outlets.

For the six-year period, Forrester predicts most online retail categories will have a compound annual growth rate of 10 percent and 20 percent, with tools, hardware and garden supplies experiencing above-average growth. Flower sales are also expected to increase at an above-average rate, while the number of telephone orders decline.

Retailers are expected to step up one-to-one marketing efforts over the period, advertising for new customers on blogs, chat rooms and message boards.

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