Online retail 'to triple by 2011'
Friday, 25 May 2007 10:14
Internet shopping is growing in popularity
Britain's online retail sector is set to triple in value by 2011, a survey claims.
A study of the online market from Verdict Research finds that shopping on the internet grew by 33.4 per cent in 2006 to £13.9 billion.
This continues rapid growth for the sector, which in 2002 saw growth worth 18.3 per cent to a value of just £1.5 billion. In four years' time expansion will have reached 8.9 per cent of all retail spending, totalling £28.1 billion worth.
Frequency of shopping on the internet, rather than higher values of products bought online, will drive the growth, Verdict predicts.
Nick Gladding, author of Verdict Research's report, said those retailers who succeed in integrating their physical and online 'channels' will be most successful.
"Viewing channels in isolation is more a recipe for failure, than for success and a seamless fusion needs to be achieved between both physical and online channels," Mr Gladding said.
"While creating a multichannel operation is by no means an easy task, the rewards for those that successfully attain this feat will outweigh the investment."
The research identifies three areas where retailers are lagging behind in getting their products online. Food retailers are wary of the major set-up costs it involves and value retailers like Matalan and Primark prefer the large-volume strategy which lends itself best to shops, while specialist shops are prevented from operating a profitable online channel because of their small scale.