Online Shopping Thriving Despite Economic Uncertainty

As e-commerce is a developing sector and accounts for only a tiny proportion of total retail sales, growth tends not to be determined by prevailing economic conditions. Revenues are more likely to be affected by changes in online behaviour than by a global recession.

GartnerG2 predicts that online B2C sales are set to rise in all regions but it is Europe that will experience the highest growth, almost 75% year-on-year. This is put down to the fact that an increasing number of retailers are integrating their mail order and web operations. By the end of 2002, the European market will have overtaken North America and be worth around $15.8 billion.

It is suggested that there is potential for e-commerce revenues to multiply still further as more European surfers switch to high speed connections. A recent report from AC Nielsen found that broadband users in the US spent more money online than their narrowband counterparts (see Internet Confidence Steady In Third Quarter, Says ACNielsen).

The internet population in North America is relatively quite experienced and over 77 million US adults already buy products over the web. As a result, there is less scope for growth than in Europe. Nonetheless, it is predicted that online shopping revenues will rise by almost a third in the final quarter this year.

Worldwide E-Commerce Revenues ($ billion)*
Region	Q4 2001	Q4 2002	% Change
North America	11.86	15.66	32.0
Europe	9.03	15.77	74.6
Asia Pacific (not Japan)	2.46	3.32	35.0
Japan	1.40	1.93	37.9
Rest Of World	0.99	1.52	53.5
Total	25.74	38.20	48.4
* figures exclude travel-related purchases and cinema and event ticket sales
Source: GartnerG2, October 2002