This is a question that we are very interested in here at SLI. Most of our customers are retailers. Through our services we are talking to these people every day. Our relationship with them feels more like it is more than just a business relationship. Their passion infects us and we really want them to succeed.
The anecdotal information we are getting about the impact of the financial crisis is mixed. Some have seen a drop in order size and volume and are feeling additional pressure from suppliers wanting to be paid earlier. Others are seeing increases. I see Amazon’s sales were up 31% last quarter. We are hearing that people are shopping on-line more to save gas – even though oil prices have fallen dramatically. Last week I asked Brian Walker from Forrester research what they are expecting these holidays. They’re predicting eCommerce to grow 12% over last holidays. This is less than the 18% growth that we saw last year but is still significantly better than retail in general.
One set of numbers we can look at is the search volumes we are serving on behalf of our customers. We have seen that the number of searches we are serving across our customers is increasing steadily. In the last month we served over 150 million queries. Part of the increase we’re seeing is because we’re getting more customers. I dug a little more deeply into the data. I looked at the search activity for a random selection of our customers for the last 30 days compared to the same 30 days last year. On average there are 28% more searches. Some are down. More are up.
Now just because people are searching more, doesn’t mean that they are buying more (Aaron Goldman had a good discussion about this in his Media Post article: Is search recession proof?). However it’s a very positive sign.
A wise man wouldn’t make predictions in this volatile market. I’ve never been accused of being wise – I predict ecommerce will be OK – just don’t bank on the huge growth we have seen in past years.