Online retailers are yet to compel consumers to shop online, says the latest report from UK based Fletcher Research. Despite evidence that British shoppers are beginning to overcome their qualms and starting to shop online, Fletcher claims that online commerce has barely begun in earnest in the UK.
Fletcher suggests in its report Window Shopping? that to combat this internet retailers need to implement credible online strategies, by establishing online brands and spending significant funds to gain new customers.
The research group estimates that the UK Online shopping market should be worth £3.1 billion by 2003. Computers, travel, clothing, food & drink and books/music are the biggest online sellers, with computers accounting for 16% of the UK market, flights accounting for 7% and books/music for 6%.
Websites such as Harper Collin’s fireandwater.com and The Electronic Telegraph’s booksonline.co.uk sprung up last year. Emap Online, which runs online retail sites for music tickets and travel, also forms one of the UK’s 49 retailing sites. The UK’s online commerce gets its main competition from US retailing sites such as Amazon and Schwab.
Total online sales in the UK accounted for just 0.2% of the total market in 1998, and only 12% of active internet users are active online customers.
Benjamin Ensor, main author of the report, commented: “Britain’s retailers must realise that the rules change when they sell online. Although the web is seen as a low cost medium, there are significant delivery and marketing costs, such as renting slots on key sites. And in most cases online shops will only make money if customers come back time and time again. So the retailers have to learn how to build relationships with customers.
“US retailers have already learnt these lessons and are using that expertise to expand into the UK, particularly in key sectors such as books and computing, where Britain’s high street retailers may already find it’s too late.”
Fletcher Research: 0171 631 0202
