Online spending drops for the first time

Consumer confidence is low and disposable income is tight

Online monitoring company ComScore is reporting that online spending has dropped for the first time since records began.

Spending for the first 23 days of November was down four per cent on the same period last year. So far in 2008 $8.2bn (£5.31bn) has been spent online, compared to $8.51bn (£5.51bn) last year.

"Despite the recent reprieve that plummeting gas prices have given American consumers, the depressed and volatile stock market, declining housing prices, inflation and the weak job market all represent dark clouds hanging over their heads this holiday shopping season," said comScore chairman Gian Fulgoni.

"With consumer confidence low and disposable income tight, the first weeks of November have been very disappointing, with online retail spending declining versus a year ago.

"It is also likely that some budget-conscious consumers are planning to wait until later in the season to take advantage of retailers' even more aggressive discounting."

ComScore is predicting that overall sales for Christmas will not grow, but may not decline. Last year online sales grew 19 per cent on the previous year but sales this year have grown only nine per cent so far.