Season's Greetings! Since most of you will be reading this during the holidays, here's our year-end gift for you: a bunch of retail research stocking stuffers -- along with our special wishes for 2004! (Beats a lump of coal, right?)

Toy buyers save more at Wal-Mart and Target, but Toys"R"Us buyers spend a lot more on toys. We wish for a hot toy to light up this beleaguered category next year.

eCommerce ends the year with a bang. When the dust settles, US consumers will have spent more than $12 billion online during the holiday weeks, and 2003 US eCommerce will eclipse $100 billion for the first time. We wish for everyone in the eCommerce trenches to get a week off before the clearance sales begin.

Retailers are zooming in on product pages. Ninety-two percent of retailers now use zoom, up from 84% a year ago, helping overall site conversion rates. We wish for every shopper to have broadband at home, so they can take advantage of the latest online merchandising tools.

Gift cards rock. Almost half of all US shoppers have given and received a gift card. Depending on when you're reading this, you may need to jump on this last-minute gift bandwagon! We wish for some of this plastic in our own stockings.

Kiosks need work. Our audit of more than two dozen store kiosks showed some unsightly blemishes. But kiosks can add to your bottom line. We wish all retailers would follow our seven best practices for kiosk success.

Self-checkout is catching on. If you're one of the 47% of shoppers who has yet to use self-checkout, you probably will in 2004, as more retailers install these time- and money-saving systems. We wish self-checkout systems would become foolproof -- soon!

Price optimization will soar in 2004. Retailers will invest in software to improve their pricing decisions and improve their top lines. We wish every retailer would move to data-driven retailing -- and test these powerful tools.

Merchants still struggle with multichannel merchandising. Our research shows that many retailers' channels still compete for products and customers. We wish retailers would integrate merchandising organizations and technologies in 2004, to take advantage of the complementary strengths of their channels.

Email needs a change. I probably don't need to tell you this -- but email is choking ISPs, and consumers are drowing in useless and frequently offensive messages. We wish the spammers would face real penalties in the near future so legitimate marketing messages can be seen.

RFID is sort of like Santa Claus: either you believe in it or you don't. We do believe RFID will reshape the retail landscape, but not overnight! We wish everyone would read "What You Need To Know About RFID In 2004" and make a New Year's resolution to get going with this important technology.

Retailers are poised to spend more on IT. This stocking stuffer is a lot better than a partridge in a pear tree. Our recent benchmarking research shows that 39% of retailers plan to spend more on IT in 2004, and only 9% plan to cut back. We wish every vendor the best of luck selling into this tough crowd, and we wish every retailer the best of luck deploying your new technology toys!


So with that, our last wish is for everyone to have a safe and happy holiday season!



Kate Delhagen
Principal Analyst, Retail

P.S. On behalf of my retail teammates Carrie Johnson, Chris Kelley, Christine Overby, Josh Walker, Esther Yuen, and Charles Wilson and everyone else at Forrester, I'd like to extend a special thanks to our retail clients for making 2003 so much fun. We're looking forward to working with you next year!

Research Referenced In This Issue If you printed this email, get links to the research featured in this week's issue by going to www.forrester.com/go and entering the five-digit number of the report you'd like to read. 2003 US Online Holiday Sales: Merrier Than Ever (32618) Analytics Leads Web Site Technology Adoption (33130) Best Practices For Search: Presenting The Results (33591) Best Practices For Search: Query Input Design (33534) How Good Is Your Email Marketing? (33524) How Retailers Can Get More From Gift Cards (33341) How To Get To Multichannel Merchandising (33210) Making Store Kiosks Work (33581) New Email Laws: A Drop In The Ocean Of Spam (33437) Price Optimization Adoption Soars In 2004 (33342) Retail Industry IT Spending Profile For 2004 (33300) Take Online Merchandising Beyond Zoom In 2004 (33235) Target, Toys"R"Us, And Wal-Mart Share Toy Buyers (33329) The Real Answer To The Spam Problem (33324) The Site Redesign Playbook (16402)    What You Need To Know About RFID In 2004 (33298) Why Most Email Campaigns Fail (33600)

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