Online spend to reach £15bn

Online sales are growing 20 times faster than the high street

The three-month festive period is tipped to set an online spending record of £15bn ­ 60 per cent higher than last year ­ despite a 13 per cent dip over the past month, according to the latest figures.

If the prediction is correct it will represent a rise rate of more than 100 per cent year-on-year for a sector that is growing 20 times faster than its high-street counterpart, says the e-retail sales index from Interactive Media in Retail Group (IMRG) and Capgemini.

November’s downturn shows that internet sales are not immune from problems affecting the wider economy, said IMRG chief executive James Roper.

“The biggest factor this quarter was the Royal Mail strike, but now the dust has settled it won’t be a problem,” he said.

“One online retailer said their traffic dropped by 30 per cent on the day of the strike.

“The Achilles’ heel for the sector is delivery, and only the big players have been geared up to take advantage of accounts with multiple carriers.”

But overall, e-retail may prove more resilient than the high street in the face of jitters over the credit crunch, Northern Rock and rising interest rates.

The average UK shopper is expected to spend some £509 shopping online this year ­ 40 per cent more than in 2006, according to figures from network specialist Netshield.

“When times are tough people look for bargains and the place to get them is online,” said Roper.

“Phenomenal growth has been caused by a range of factors: availability of broadband, functionality, capacity caused by massive investment by retailers, and familiarity because big names are doing well online.”

Nicolas Kalmus, sales director of GreatValueJewellery.com, said: “We noticed a slightly later start to the Christmas buying season this year.

“We put down to a combination of credit crunching and more savvy buyers who predict the early start of sales online and on the high street.”