According to a survey reported this month by Reuters, the online retail industry is still a long way from reaching saturation point.
The US survey commissioned by Shop.org and carried out by Forrester Research showed a 25 per cent growth in US online sales in 2006 compared to the 20 per cent forecast. The survey used data from 170 US retailers.
The increased growth was attributed to:
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More users having broadband access |
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An increasing number of websites offering easy to navigate online shops |
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Retailers promoting free delivery and free returns |
Websites are becoming more sophisticated; providing high quality images of the products they sell. This factor has been credited with the increase in the amount of clothing, footwear and accessories sold online. For the first time, the sale of clothing outstripped computer purchases (61 per cent increase compared to 20 per cent in 2006).
US online growth this year is expected to slow to around 18 per cent - a figure of $259 billion. According to Scott Silverman, executive director at Shop.org, retailers still need to exploit the online opportunity and invest accordingly:
"Retailers are just beginning to see what the potential is. But a lot of them are fairly behind in terms of having an appropriate investment level to take advantage of that opportunity."
Research in the UK backs up the case for offering free delivery as a means of encouraging online sales - a recent survey by CheetahMail suggests nearly a third of online shoppers who abandon their baskets at the checkout point would continue the sale if they were offered free delivery/postage and packing or a small discount. When you consider that 41 per cent of the 25 million UK shoppers (source IMRG) abandon their baskets at the checkout, this is not an insignificant number of buyers. According to CheetahMail, these shoppers should be targeted in "Re-marketing" campaigns and offered incentives to revisit sites.
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