Online spending up 15%, signs of an improving economy?

Put away that cyanide pill, consumer confidence and spending are both up

The race was agonizingly close last night, which means that we all know someone who is very angry today.  Maybe you’re the one who’s going out and stockpiling canned food and bottled water in preparation for our imminent national collapse, a la Greece (if you’ve been watching FoxNews).  But if you’re in the mood for a little pick-me-up on the state of the economy, just check out the latest data on online spending.

ComScore released its latest e-commerce report Wednesday, in which it revealed that online spending was up 15% in the third quarter, marking the eighth consecutive quarter of double-digit growth. 

U.S. consumers spent $41.9 billion online last quarter, compared with $36.3 billion in Q3 2011.  That spells good news for the upcoming holiday season.  

Consumer spending on the whole (not just e-commerce) was up 0.8% in September, marking the largest increase since February.  Consumer spending drives some 70% of total economic activity.

“With the housing market beginning to show signs of recovery in addition to increasing – if still underwhelming – job growth, there appears to be strong enough footing to support a very healthy online holiday shopping season,” said comScore Chairman Gian Fulgoni, in a statement.

Consumer confidence is picking up a bit, with 48% of comScore survey respondents rating the economy as “poor.”  This is actually an eight-point improvement over last quarter, and the most marked improvement since early 2009, according to comScore.

Nielsen noted in a blog post last week that North American consumer confidence was up three index points to 91 last quarter, compared to an index of 88 last quarter.  The baseline is 100.

“Consumers in the U.S., while less directly impacted by Europe, continue to be cautious in the face of an uneven recovery, marked by still-elevated unemployment levels and disappointing payroll growth,” said Dr. Venkatesh Bala, chief economist at The Cambridge Group (a part of Nielsen), in a statement.

The top performing online categories for Q3 were digital content and subscriptions, consumer electronics, event tickets, apparel and accessories, and computer software.  ComScore notes that each product category grew at least 16% versus the same quarter last year.

The popularity of digital content and subscriptions is particularly interesting.  I took a peak at previous e-commerce trends as reported by comScore and in Q3 2010, books and magazines (excluding digital downloads) led among top performing product categories.  Thus, in two years, tablets and e-readers have literally replaced print books and magazines.

Image source: uproxx.com