As the CBI likes to keep reminding us, high street sales are in the doldrums at the moment. However, online retailers are having no such trouble. In 2007, the amount of money we spent on internet shopping jumped 35% to £14.7bn, according to retail analysts Verdict Research. That’s the fastest growth rate in six years, and means that online retail is growing ten times faster than the retail market as a whole (albeit from a much smaller base, of course).
According to Verdict Research’s poll of 4,000 shoppers, customers think shopping online means they waste less of their valuable leisure time – after all, why spend your Sunday afternoon fighting through the hordes at your local supermarket when you can sit in your garden and get them to come to you instead? No wonder 23m of us are now turning to the internet for a hassle-free retail experience – or that we're spending more money than ever before.
One of the reasons for this surge in online spending is that retailers are starting to sort out their internet presence – big operators like Ikea have started selling their goods online, while the early adopters have been expanding their offerings. Sales of furniture, video games and music are all on the rise, although about half of our money is still going on groceries and electricals – particularly in the latter case, shoppers think they’re more likely to bag themselves a bargain online. ‘The internet is widely perceived as a cheaper and easier way of finding lower prices in most sectors,’ says Verdict's senior retail analyst Malcolm Pinkerton.
Apparently more men shop online than women, and also spend more when they do – according to Verdict, that’s because they’re either ‘inherently lazy’ or ‘fashion savvy and brand aware’. We know where our money is…
And with the internet getting faster, cheaper and more widely available, Verdict sees no reason why this growth rate should slow – even if the high street woes continue. ‘The channel will find itself extremely well-placed to capitalise on the falling consumer confidence and lower levels of disposable income currently impacting the retail market,’ says Pinkerton. In fact, it reckons the only way is up for online retail, with sales predicted to treble to about £45bn by 2012.
We couldn’t agree more, which is why the three ex-bankers behind online grocer Ocado are the cover stars of this month’s MT. Click HERE to read our exclusive interview with Tim, Jason and Jonathan, as they tell us how their model works (and try not to talk too much about their bid to take Tesco to the cleaners).
After all, given that none of us can afford to fill our car with petrol to get to the shops any more, it's no wonder that online retailers are onto a winner...