Rising gas prices push consumers online

Retailers need to step up their direct-to-consumer operations as gas prices bite and consumers look for ways to save money, including shopping online.

by Helen Leggatt

The increase in gas prices is being touted as responsible for poor sales during the 2007 holiday season and a new survey from Nielsen has found that consumers will continue to keep a tight rein on their purse strings.

"Unlike 2005 and 2006, gas prices didn't drop in the fourth quarter of 2007 to enable consumers to do their typical holiday binge buying," said Todd Hale, senior vice president of consumer shopping and insights, Nielsen Consumer Panel Services.

"That said, our research shows a jump in consumers shopping on the Internet as a way to deal with high gas prices," he added.

Nielsen’s survey found that almost half, 49 percent, of consumers are decreasing their spending to balance out the increase in gas prices. Some are doing this by combining shopping trips with other errands, many are dining out less and more people are using coupons (25 percent compared with 20 percent last June).

Retailers that increase their direct-to-customer channels, especially online, will find a growing at-home audience looking for bargains and ways to save money and, if at all possible, to avoid starting the car.