| Online Retail to Exceed £37 Billion by 2014 |
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40,000 stores already abandoned high street as online sales dominate and mobile retail explodes
LONDON, 18 April 2011 – Online retail is growing six times faster than high street sales and is predicted to exceed £37 billion by 2014. The Webloyalty Online Retail Report by Verdict Research predicts that current internet spending will grow by £14 billion (61%) from 2010 to 2014. The rapid growth is being driven by shoppers heading online for convenience, and coincides with a predicted boom in the role of mobile phones in the shopping experience. The report maps the future of the UK’s high streets, showing mobile retail as driving dramatic changes ahead. 40,000 stores have already abandoned the high street in the last decade and this trend is set to continue. Many familiar brands will disappear from town centres as a growing number of retailers close shops and focus instead on booming online and mobile retail. “We estimate online retail to exceed £37 billion by 2014, a rise of 61% from 2010. As a result, shoppers need to prepare for a radical change on their local high street. By 2014, we predict the high street will become less about shopping and more about the experience. Apple is ahead of the game, where their stores have already become a destination rather than a just a shop. You can look, touch and test the products, speak to experts and make your decision, but then buy online. “The next step will be the use of mobile phones as part of the shopping experience. Soon, consumers won’t think about hitting the high street without their smartphone. It will be absolutely essential - not only to browse, but for how we pay, locate products and find the best deals and discounts,” says Neil Saunders, Verdict Research. The role of mobile phones in the way we shop is expected to alter significantly. Just over half (52%) of UK consumers currently use their mobiles during the purchasing process, but in the next five years this is expected to hit 80%. “Shoppers after a better deal will use their mobile to compare and find prices. Retailers that survive on the high street will be those that combine their online stores with mobile apps that offer shoppers a better deal using location-based offers. Almost half of all Brits own a smartphone - which will be how shoppers locate and compare the best prices in the very near future,” says Neil Saunders. The Webloyalty Online Retail Report by Verdict Research has analysed the development of different retail sectors and predicts some of the most significant changes in the technology arena. 40% of electricals and 80% of music, films and games will be bought online by 2014, which will render many more retail spaces as redundant. “Shoppers are beginning to find it increasingly difficult to find their favourite CD, film or book on the high street. HMV have announced the closure of 40 HMV and 20 Waterstones stores this year – where their shops have become nothing more than costly overheads. Shoppers are still buying entertainment, but are looking for better deals online – and this will soon be done on smartphones whilst on the go,” says Neil Saunders. This move away from the high street is also reflected by the continued growth of out-of-town shopping centres, where rents remain cheaper than in city centres. Out of town retail space grew 34% from 2000 – 2009, while high street space shrank by 8.9%. For shoppers, this means they will have no choice but to leave the high-street for out of town store locations, or head online. “Mothercare is an example of a retailer who is taking up retail space in retail parks away from the high street where overheads are cheaper. Landlords on the high street will not be able to compete. We have already seen JD Sports negotiating cheaper high street rents amid difficult sales conditions. The competition might make the high street more attractive once again to smaller boutique or local retailers. This could spell the imminent death of ‘clone town Britain’,” says Mr Saunders. Martin Child, Managing Director, Europe of Webloyalty adds, “The Webloyalty Online Retail Trends report paints a clear picture of the shopping experience of the future. Shoppers will be able to find the best deal – either online or using their mobile – and the onus is now on retailers to rethink their high street presence in order to remain competitive. But retailers can’t just rely on foot-fall anymore – online is crucial for today’s success. Mobile is the secret for tomorrow.”A PREVIEW OF SHOPPING IN THE FUTURE: Bulleted points from the report that describe the consumer experience of 2014... and beyond.
Lennard van Otterloo About Webloyalty Webloyalty partners with over 120 online retail and travel businesses globally to help them drive incremental revenue and repeat purchases. Through its savings, discount and protection programmes, such as Shopper Discounts & Rewards*, Webloyalty offers consumers who make a purchase at a partners' websites the opportunity to benefit from discounts of up to 10% at over 800 top online retailers, as well as ongoing cash back incentives for repeat purchases at the partners’ website.*About Shopper Discounts & Rewards Webloyalty’s membership programme, Shopper Discounts & Rewards is designed for regular online shoppers. For a 30 day free trial and only £10 per month ongoing, the programme will provide members with the following benefits:
For further information please visit: About Verdict Consulting Verdict Research is the leading authority on retailing. The firm has privileged access, at the highest level, to key executives working within the top 200 retailers. Its research and publications provide executives working in a wide range of business sectors - retailing, manufacturing, advertising, marketing, professional services, property, finance and the media - with unrivalled independent analysis of the retail sectors, key trends driving each, insight into the major players and forecasts. |
