NEW YORK (CNN/Money) -
Wigs, bandanas, Santa suits, adult entertainment, religious ministries.... you name it and the Internet's got it for you just in time for Christmas.
With online retail sales looking red hot this holiday, it's not surprising that anyone who has anything to sell is scrambling to get a parking spot on the Web.
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Monte Cahn, CEO of Internet domain registrar Moniker.com, said the frenetic pace of domain registrations in the past 60 days alone is unlike anything the company has seen since it was founded back in 1996.
The Pompano, Fla.-based company accounted for 40,000 domain registrations over the last two months, including both new names and client transfers from other registrars to Moniker. That's up from just 7,200 registrations over the same period last year.
However, the situation that Cahn describes does sound eerily familiar. Remember the Internet boom of 1999 that went bust in 2000 and took out such heavy hitters as eToys, pets.com, excite.com and mortgage.com?
"The difference between 1999 and now is that people are not just buying a lot of domain names and holding on to them, but they're actually turning them into e-commerce entities," said Cahn.
"Back then, Amazon wasn't making money and eBay was new," he added. "Today there's profitability in e-commerce and a lot less fluff out there. If anything, the boom-bust has taught people that just having an idea won't work. They have to focus on developing solid core business fundamentals."
Shawn Milne, analyst with SoundView Technology agrees.
"Even though the Internet represents a huge market opportunity, especially for small businesses, just getting a domain name doesn't mean anything," said Milne. "You still need capital, technology and access to inventory to eventually get to that pot of gold at the end of the rainbow."
Weird, wacky and whimsical
A quick glance at some of the types of "businesses" that timed their online debut to coincide with the holidays shows few stones left unturned.
There's wigs.net that sells the Raquel Welch signature collection of faux hairdos; You can buy a single Paisley bandana for $5 or a case of 50 for $250 at bandana.com, or pick up a Santa Suit at SantaSuits.com.
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Then there's 1800sexmate.com or 1800sextime.com. The names pretty much explain the concept on offer once their Web sites go live.
About 90 percent of these new sites are already functioning Web sites, said Cahn, with adult entertainment and online betting and gambling the two categories seeing the biggest surge in domain name registration.
"This year has been very strong for the e-commerce industry," said David Berkowitz, spokesman for e-commerce research firm eMarketer. "Every indicator in this space, from online sales, broadband growth and domain registration is up. It's not surprising that individuals, small businesses and even the bigger brick-and-mortar retailers who didn't have an online presence before now have a Web site."
Additionally, Cahn also credits softness in the labor market to the upswing in e-commerce.
"People who lost their jobs recognize that there's a lot of money and opportunity in this space and they were encouraged to start their own business. Starting it online is both cheap and fast," Cahn said. The annual fee to register a new name is anywhere from between $18 and $35.
A solid season
Total holiday Internet purchases are expected to jump 30 percent year-over-year to about $17.8 billion, according to eMarketer, while total sales in 2003 are forecast to grow 20.8 percent over last year to $55 billion.
Separately, ComScore Networks' holiday forecast is for Internet sales to grow between 25 to 30 percent this year to between $12.1 to $12.6 billion, up 31 percent over 2002.
"The Internet is gradually becoming more of a standard way to shop," said Berkowitz. "It's convenient to use, especially as people are more confident now of using their credit cards online. Web vendors are giving customers what they want like free shipping or the option to order online and pick up the goods at the store."
But despite all the sugary predictions, analysts point out that at the end of the day, the Internet accounts for less than 2 percent of the overall retail sales pie, which last year totaled over $3 trillion.
"So even if we have a very strong season for Internet sales, it doesn't necessarily signal a strong holiday season," Berkowitz said.