22 Sep 2009
UK shoppers spent £3.8bn on the web during August – a 16 per cent year-on-year growth, despite a monthly dip in sales, according to the latest IMRG Capgemini e-Retail Sales Index.
Sales fell by 10 per cent from July to August, prompted by decreasing growth in sectors such as alcohol (down 7.3 per cent) and clothing (down by 19.1 per cent), seen as a sign of consumer belt-tightening in recessionary times.
According to the IMRG report, the August numbers are “closely in line” with previous seasonal trends.
Shoe retailers were the best performers last month, with sales rising by three per cent.
According to the report, retailers are making ”the greatest strides” to improve their online propositions, with better usability features, more use of Web 2.0 tools and more convenient delivery and return models.
“The continued annual growth in the online retail market is evidence that this medium is withstanding the challenges of the economic downturn and the retailers that continue to expand and improve their online presence will no doubt reap the benefits during the festive trading period,” said IMRG director of information Tina Spooner.
Most high-street retailers are still placing their bets on the online sector, with firms such as John Lewis investing in revamped web propositions.
“Fashion online is one of the biggest business opportunities for John Lewis over the next three years and there will be a significant step change in our customers' shopping experience online,” said John Lewis Direct managing director Robin Terrell.
“We want to mirror and exceed the growth that we've achieved in fashions in our 27 John Lewis branches, and ensure all the great niche brands in our stores are available to a much broader audience.”
It is encouraging that retailers are making great strides in improving their online propositions, especially with August web sales reaching £3.8bn ? a 16% year-on-year growth. However, ensuring you match the branding of all the other channels is only half of the aesthetic battle in designing a retail web site. Retailers must pay more attention to the actual interaction and feed the needs of their online customer base by utilising a 'magalogue' style web site.
Many successful mail order businesses have learned the value of sending their customers material that is part magazine and part catalogue, often referred to as 'magalogues'. It is only by embracing such a style, which includes news, trends and ever-changing 'hot buy' items, that retailers will provoke the consumer interest and loyalty required to increase online footfall and generate rapid revenue growth.
Fashion web sites netaporter.com and asos.com have online businesses that are larger, faster growing and more profitable than almost any other clothing and footwear supplier and yet they have no history of mail order or a large store estate to help them build a customer base.
One distinguishing characteristic of these businesses is that they have built websites that are enjoyable to browse and are constantly refreshed with new content ? recognising that their customers are looking for something more. In comparison, the majority of web sites follow accepted, utilitarian guidelines to streamline the user experience, minimise clicks and deliver a fast, no-frills service.
If retailers are to attract the online footfall required to drive additional revenue and continue the growth in online spending, the website needs to become a 'must visit' destination. With modern, purpose-built tools, retailers can create the innovative, up-to-date and compelling content that will allow them to properly engage with their customers.
Simon Hanson
Product Management Director
Prologic
www.prologic.com
Posted by: Simon Hanson, Product Management Director, Prologic 24 Sep 2009
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