Retailers who do not provide an online sales option to their customers are going to lose out on their business, as more shoppers are preferring e-commerce to high street shopping.
Businesses which do not invest in e-commerce are 30% more likely to fail, says Tenon Recovery, a turnaround, restructuring, recovery and insolvency specialist. Online retail sales in the UK rose from £46.6 billion in 2007 to £53.2 billion in 2008.
The rise in online sales was simultaneously marked by the closure of several high street stores. According to Tenon Recovery, the high street casualties are increasing as the businesses are investing more in brick and mortar buildings but not in e-commerce sites.
Carl Jackson, national head of Tenon Recovery, says that the new-age consumers like to go shopping with their fingers rather than their feet, as it is easier for them to compare prices online than move around the high street. Businesses which do not enable their consumers to shop 24 hours a day are at a disadvantage.
Tenon Recovery’s estimates are in line with the IMRG Capgemini e-Retail Sales Index for 2008, which has found that the online sales in the UK in December last year increased by 14.2% from 2007. The Index has observed that consumers are turning to online shopping to beat the credit crunch.
The 2009 edition of Logan Tod Online Shopping Index estimates that the UK’s adult population will increasingly go online shopping during Christmas 2009. This trend would help e-tailers who ensure better availability of products, effective search tools and smarter delivery options.
Jackson said: “By transferring from bricks to clicks, retailers can boost their profits substantially, reduce their running costs and capture consumer spend around the clock. A business needs far less capital to create an online empire than expand its presence on the high street.”
