New e-commerce data show middle class are broke

Posted Dec 17th 2007 9:30AM by Douglas McIntyre
Filed under: Analyst Reports, Industry, Wal-Mart (WMT), Economic Data

There has been real concern about this year's e-commerce numbers. comScore has online spending up about 18%. The data for the period from November 1 through December 14 show sales of $22.67 billion.

But, these numbers are down from a growth rate of 26% for the same period last year. Part of that may be due to big percentages being harder to hit as the base grows. That explanation may not be acceptable to Wall Street. Online revenue is still only about 5% of total retail sales. A drop-off in the numbers must have some other explanation.

It turns out that there is reason, and it is an unpleasant one. comScore's data show that people in households with incomes under $50,000 have only increased their spending 10% so far this holiday season. Shoppers in households with incomes over $100,000 are spending 28% more.

What is evident is that people with modest incomes are feeling pinched. It's no wonder with fuel prices high and home prices low. These essentials usually make up a larger portion of the budgets of those who are not in the affluent tiers of the population.

Who gets hurt by the numbers? Discount retailers which cater to the middle and lower classes such as Wal-Mart.com (NYSE: WMT).

Douglas A. McIntyre is an editor at 247wallst.com.

Tags: comscore, consumer confidence, ConsumerConfidence, featured, holiday spending, HolidaySpending, online holiday spending, OnlineHolidaySpending, retail sales, RetailSales, wal-mart, wmt

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Reader Comments (Page 1 of 1)

12-17-2007 @ 10:52AM

EW said...

We are broke. we are taking jobs that are paying .5 to .6 of what we were paid before. The Whitehouse and Congress have their backs turned to the problem and a trainwreck is going to hit them in the rearend. But they'll have the top healthcare in the country to fix the sore butt.

12-17-2007 @ 1:47PM

jack barry said...

well lets get back to the bad old days lets start making moonshine, and growing weed .if they keep taking the legal ways to make a living off of us , we are going to have to stand up , take the chances and take it back from them.