Meanwhile, Internet research companies have sniffed opportunity. Massachusetts-based Forrester Research, for example, is analyzing the new economy for clients that range from Sprint to Bank of America by asking more than 131,000 Web users about their buying habits. They are a little behind the curve. But if sales at online luxury retailer Red Envelope are any indication, the industry is expanding at breakneck speed. Red Envelope's December volume was five times last year's, according to CEO Hilary Billings.
Billings expects exponential growth in online retail sales the next five years.