Member Article

Online retail set to cast its net wider

By 2011 virtually everyone under the age of 55 will have used the internet to buy goods and 70% of the UK shopping population will regularly be buying goods online compared to just over 50% of consumers today. Consumer behaviour, both expected and unpredicted, is driving the online retail market to new highs, according to research by PricewaterhouseCoopers LLP. The value of the online market could reach almost £35 billion, nearly three times current spending, by 2011 and internet shopping is likely to account for up to 10% of the entire retail market, PWC’s figures show.

PWC’s research and interviews with industry leaders revealed that the growth of the online retail channel over the next four years will be fuelled by three key factors – the growth of a web-savvy population, more people in higher age groups willing to use the internet for shopping, and the increasing confidence of online shoppers. According to the survey, in the near future twenty-five per cent more online shoppers will be buying food and groceries online (currently 38%).

Bill MacLeod, partner, PricewaterhouseCoopers LLP, Newcastle commented: “The reality of online retail is finally catching up with the early hype, with online sales for 2007 predicted to grow by almost 30% on last year’s high. All indications point to double digit growth in the years ahead. The UK retail sector is an industry in transformation.

“The growth of online retail means that conventional retailers will be facing a double whammy in terms of cost. They will be working harder for customers: they will be making less money in the online space and competing more heavily in high cost areas to improve the shopping experience in their stores. More than ever, having the right customer proposition and flawless execution will be critical to deliver the necessary sales growth.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .