Bustling has slowed for online stores

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TEXT OF STORY

Bill Radke: Later this morning, the government reports retail sales for June. Since we are a retail economy, that's a big deal. The experts are guessing all the price-cutting stores have done has finally brought shoppers back through the doors
and sales rose a little. But what about those retailers who don't want you to go back to the stores? Marketplace's Dan Grech has this look at the e-tailers.


Dan Grech: The increased competition among online stores has forced many e-retailers to slash their prices. That's hurt month-to-month sales growth, which has been negative since February. Some Web retailers,like Parent Company, which sold children's products, have closed their virtual shutters.

Analyst Sucharita Mulpuru is with Forrester Research. She says the big online brands, such as Amazon.com, Blue Nile and Zippos, are holding up better than smaller e-retailers.

Sucharita Mulpuru: It's a very, very long tail, you know, of companies that are duking it out for dollars that people are spending in the Web channel.

Online sales are expected to grow by 11 percent this year to $156 billion. That's a far cry from the 18 percent jump in 2007.

Experts say door-buster specials may be luring some customers back to in-store shopping.
Mulpuru says the companies that will do best online are brick-and-morter with strong existing brands, like Macys, Wal-Mart and Best Buy.

I'm Dan Grech for Marketplace.

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