Online sales still high despite downturn

Retailers wil take advantage of the web to thrive during tough economic conditions, says report

“When the going gets tough, shoppers go online," says the IMRG

Online retail is still at a record high despite weak high street sales, according to the IMRGCapgemini e-Retail Sales Index.

The survey says UK shoppers have spent £13bn online during the first quarter of 2008, which represents an equivalent of £213 for every person in the country.

Consumers have spent more than 50 per cent more on web shopping compared to the same period last year, when spending figures reached £8.8bn.

And despite a poor Easter week in the high street, nearly £850m was spent online during that period.

Spending per online visit now stands at an average of £12, a threefold increase in comparison to the £9 figure five years ago, said the index.

The beers, wines and spirits segment saw a 60 per cent surge in online sales towards the end of the first quarter of 2008. Meanwhile, consumers spent 21.8 per cent more on the clothing, footwear and accessories in March compared to February.

Consumers are becoming more aware of security and logistical issues surrounding online shopping and are increasingly demanding better services, said Bruce Fair, UK managing director of price comparison specialist Kelkoo.

“We have seen that online shoppers are wising up to the security issues of online shopping - around 40 per cent of Kelkoo customers are choosing to shop with retailers who are accredited by the IMRG ISIS security standard,” he said.

“People are also becoming more demanding with the delivery services retailers are offering. This is being addressed by the recent IMRG IDIS delivery accreditation initiative, which assures shoppers that the retailers they choose offer reliable, simple and clear delivery services."

E-commerce will provide an opportunity for retailers to reach out to customers with tight budgets, said managing director of Interactive Media in Retail Group (IMRG) Jo Evans.

“When the going gets tough, shoppers go online. We have seen this before during every downturn since the Index began, so can confidently predict that e-retail will buck the high street's flatline trend and continue to grow strongly during the year ahead,” she said.

“Consumers are being extra careful with their money, so retailers are responding with highly competitive offers that the transparency of the online marketplace makes it easy for people to find. However bad the macro market conditions become, people still need to buy stuff, and smart retailers will continue to thrive online by squeezing more and more efficiency out of the channel.”