Tablet PC with Christmas theme backdrop
Published 19 Dec 2016

E-commerce in 2016

Another year of online sales growth predicted

In the lead up to the busiest time of the year in the retail calendar, have you been brave enough to face the queues in the shops?

Or have you been tempted to sit in front of the computer with a coffee to complete your Christmas shopping?

Whichever way you choose to shop, it’s an undeniable fact that e-commerce has been the biggest revolution in retail for decades. Online shopping revenue has almost doubled in the past five years, with close to £150 billion expected to be spent in the UK by the end of 2016. Indeed, recent statistics estimate that 76% of UK shoppers will buy at least half of their Christmas presents online this year.

One of the key reasons for the year on year growth of online shopping is the sheer number of people that now use the internet. Of the 65 million people living in the UK, 92% of them use the internet on a regular basis. When you consider that 77% of those 59.8 million people made an online purchase in 2015, that’s a massive market to sell to!

However, online sales only account for 16.8% of the total retail market in the UK, so you can see that there is still room for huge growth and expansion. This growth will in part be driven by an increase in online shopping on mobile devices. About 30% of all e-commerce traffic comes from mobile devices, but with over 74 million mobile devices in the UK there is once again substantial room for growth. Larger screens on devices plus dedicated apps from retailers will help drive this growing market forward.

Online retailers like Amazon and eBay have become household names in the UK over the past few years. Amazon made £6.31 billion alone from Britain in 2016, up £550 million or 8% on the previous year. In fact most major retailers, even the ones that traditionally operate physical stores, are now taking an online approach to complement their existing business models. For example retail giant John Lewis has really managed to drive its business forward by a combined online/physical store approach, with about a third of its current sales taking place online. The company stated that online sales grew by 17% in its latest financial year, while instore sales dropped 1%.

So let’s recap some of the many benefits of shopping online:

  1. Convenience. Shop whenever you want, 24/7, 365 days a year.
  2. Better prices. Generally, you’ll get the best deals online for many reasons: products come to you direct without any middleman, no overheads associated with physical shops, and retailers wanting to drive you online.
  3. More choice. You can shop anywhere in the world.
  4. Price comparisons. Researching products and comparing prices is so much easier online. You really can dig out the best deals.
  5. Reviews. Find out what others shoppers think of the product – and the frequent inclusion of demographic information means you can get the views of people like you.

So whether you prefer visiting a physical shop or waiting for Santa to deliver your gifts in person this Christmas, you can’t ignore the allure of online shopping. Its phenomenal growth is testament to its many benefits and the increasing ease with which we can buy online. How we all shop is down to personal preference and what we’re actually purchasing.