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Technology / Networks

Online sales defy downturn

Shopping on the high street may be suffering, but online retailers reported a bumper Christmas, with over £4.67bn being spent on the Internet during December, according to figures from IMRG Capgemini e-Retail Sales Index.

The figure represents a 14.2% increase on the same period in 2007 and equates to £76.67p per person in the UK. The figures reveal that a third of shoppers (37%) did more than half of their Christmas shopping online, while two-thirds (59.9%) spent more online this festive period than in 2007.

While the year-on-year figures are impressive, monthly growth was down 1.5% compared to November, the first time since December 2002 that the Index has recorded a fall. Capgemini believes this fall is due to shoppers getting their Christmas purchases done during the last two weeks of November rather than in December.

The biggest winner in terms of online sales this year was clothing, which showed a whopping 32% year-on-year growth. Clothing was one of the last retail sectors to take off online because shoppers were reluctant to spend money on an item that they had not seen or tried on.

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Of the 2,000 shoppers quizzed for the survey, 21% admitted to often or always buying clothes in multiple sizes with the aim of sending back any that do not fit. However, 20% said that the inconvenience of returning items put them off making more online purchases.

Mike Petevinos, head of consulting for retail at Capgemini, said: “People are getting much more familiar with buying clothes online; the delivery and returns policy are getting much, much better. People are seeing merchandise improving on websites so they feel more comfortable making those purchasing decisions without trying on the clothes.”

People stocking up on alcohol supplies before Christmas resulted in sales of beers, wines and spirits increasing 13% month-on-month, but they were down 16% compared to December 2007. This is probably due to aggressive sales techniques employed by supermarkets.

The health and beauty and lingerie sectors both reported a month-on-month fall of 13%, and year-on-year falls of 4% and 11% respectively.

Overall, however, the figures represent a boon for the retail industry after a disappointing year that saw the worsening economic situation claim high street regulars Woolworths and Zavvi.

James Roper, CEO of IMRG, told CBR that he expects online sales to keep on rising, with more and more retailers focusing on online sales. “The economy will drive a move to online sales. The costs and carbon emissions associated with it are lower. For example, with a best seller book, traditionally about a third of the printed copies are pulped because they aren’t sold. An online retailer, like Amazon, will always know just how many to order, so the wastage is less.”

Roper also told CBR that there is no excuse for retailers shunning online shopping. “There are some suppliers that actively stop products from being sold online. Some electronic retailers want people to hear their hi-fi systems before making a purchase in the shop. But as customers grow to understand a brand, and become more familiar with it, that is not really necessary.”
This article is from the CBROnline archive: some formatting and images may not be present.