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To: MoonBrother who wrote (53375)	4/28/1999 4:42:00 PM
From: Glenn D. Rudolph	Respond to of 164684

Commerce Deparment To Track Internet Sales With New Sales Category Dow Jones On Line - April 28, 1999 16:38 By Stephanie Hoo, Staff Reporter NEW YORK (Dow Jones) - The Department of Commerce, like the private sector, is trying to track the progress of internet sales, and said this week that it hopes to produce a separate online sales category within its retail sales reports by the middle of next year. Estimates of online sales vary widely between $3 billion and $18 billion a year. "I've seen so many sophisticated wild guesses," said Don Gilbert, senior vice president of information technology at the National Retail Federation in Washington, "(but) the folks at the Census Bureau are probably the only people who can apply scientific methods." Reliable data should help take some of the hype out of online retailing, Gilbert added. Right now, that hype is confusing data watchers on Wall Street and elsewhere, said Frederick Knickerbocker, associate director of economic programs at Commerce's census bureau. "There's a lot of enthusiasm for (Internet sales data) right now - a lot of speculation going on right now," Knickerbocker said. "People keep calling and saying, 'What's the government's official number?'," said a Census Bureau analyst working on the project. "We want to define it, put a fence around it, because everybody is trying to make a splash. Internet sales right now are a hot topic." Commerce plans to put online sales under a separate heading within its retail sales report starting with 1999 year-end figures, to be reported in mid-2000. Currently, online sales are lumped into other categories, such as mail-order or department-store sales. Before Commerce can break out online sales, it has to define what should count in that category, said Kate Delhagen, director of e-commerce research at Forrester Research in Cambridge, Mass. "It's kind of scientist's worst nightmare," she said. "Every variable is changing. The players are changing, the channels are changing, the consumer spending patterns are changing." Delhagen estimated that Commerce would need "a couple of years of learning" to address some of the questions about measuring online sales. For example, if Amazon.com Inc. (AMZN) sells a book over the Internet, that's obviously an online sale. But what if a shopper sees a product online, fills out a form, then calls an 800 number to finish the sale? Is that e-commerce revenue or a telephone sale? And what if an Atlanta-based retailer sells to a customer in Tokyo via the Internet? Does that count as a domestic sale? Whatever the conclusions, Commerce knows there's hunger for its input, and recent heady sales data have heightened the need for a definitive, government-endorsed figure. Commerce announced the project in February, when strong 1998 holiday season sales figures starting rolling in. So far, researchers have said that some Wall Street estimates of $15 billion a year or more in Internet sales are too high, because they include items such as airplane tickets and concert tickets, which the department doesn't consider to be retail, the census analyst said. Eventually, a Commerce onlines sales figure should help answer other questions about sales trends, such as whether the Internet is boosting shopping overall. "Which sales are substitutions and which are additions?" Knickerbocker said. "It's a major issue." -By Stephanie Hoo; 201-938-4384; stephanie.hoo@dowjones.com