Teens Pose Problem for E-tailers: Report

14 January 2002

When it comes to shopping, teenagers prefer the mall, judging by a report in the New York Times highlighting the difficulties e-tailers experience in selling their wares to minors.

Under-18s are a sizeable market in the US, spending some $155 billion a year according to Teen Research Unlimited. However, even though 80% of teenagers have web access, Jupiter Media records their online spend at a paltry $1bn.

A major obstacle facing internet retailers is payment options, or rather lack of them. Credit cards are largely unavailable to minors, who have to borrow their parent’s plastic to buy online – apparently a sufficient deterrent to send the mean teen to a bricks-and-mortar store.

In response, a number of credit card companies have launched teen-focused cards (which require parents to put cash into the account before it can be used), but with mixed results. “The idea of a teen card is a good one,” insisted analyst Aaron McPherson. “The card companies just haven’t found the right formula, yet.”

Nevertheless, some dotcoms aimed specifically at the age group are doing well despite the payment problem. Apparel and accessory retailer Delia’s, which sells to teenage girls through stores, catalogues and a website, claims around 90% of its online sales are made through parents’ credit cards. The key, says chief operating officer Evan Guillemin, is to “deliver the right merchandise in a way that’s compelling for the kid, and establish their trust.”

News source: New York Times