Online retail sales grow despite security concerns

Today, the US Commerce Department released retail e-commerce data for July - September. It shows that retail sales increased 1.8% overall from the previous quarter, while retail sales increased almost 6% in the same time. E-commerce's share of total retail sales edged up slightly to 2.3%. Thus continues a slow but steady growth since the first release of e-commerce data for the fourth quarter of 1999, which showed that less than 1% of all retail sales were conducted online.

This seems to contradict a recent poll by Consumer Reports WebWatch, a service of Consumer Reports, whose results were released on 26 October. Entitled "Leap of Faith: Using the Internet Despite the Dangers" (pdf report) indicates that consumers are fearful of identity theft and have reduced their online commerce:

Nearly nine out of ten users (86 percent) have made at least one change in their behavior because of this fear:
• 30 percent say they have reduced their overall use of the Internet.
• A majority of Internet users (53 percent) say they have stopped giving out personal information on the Internet.
• 25 percent say they have stopped buying things online. • 54 percent of those who shop online report they have become more likely to read a site’s privacy policy or user agreement before buying.
• 29 percent of those who shop online say they have cut back on how often they buy on the Internet.

Recommendations to nonprofits:
1. Don't believe the polls. Use of the internet will continue to grow steadily, with regular leaps (election cycles, disasters, etc.).
2. Be respectful of donor's privacy and security concerns. Post an easy-to-read privacy policy and stick to it.
3. Make sure your donation processing follows industry guidelines.
4. Post your most recent 990 form and any industry efficiency recognition you have received, e.g. from CharityNavigator or others.

Rick...