Online Christmas sales forecast to rise 14% to £7.75bn

By Arif Durrani, marketingmagazine.co.uk, Monday, 14 November 2011 02:52PM

Despite the tough economic climate, ecommerce in the UK is expected to rise 14% during the five-week shopping month of December, to £7.75bn, according to new research.

Online Christmas sales forecast to rise 14% to £7.75bn

A report from the Interactive Media in Retail Group (IMRG) published today predicts the record online spend, up from £6.8bn in 2010, will be partly propelled by a surge in people using mobile phones.

Drawing on research carried out by IMRG and eDigitalResearch earlier this year, which found that 35% plan to do more shopping via their mobiles, the impact of m-commerce is highlighted as a key 2011 sales driver.

UK shoppers are said to be becoming adept at navigating between available branding channels to secure the best possible deals, reacting to incentives through mobile marketing and social networks, as well as in-store and above the line promotions.

David Smith, chief marketing and communications officer at IMRG, believes the behaviour of this new agile consumer "reinforces the importance to retailers of offering a multichannel solution".

He said: "Consumers want choice and continually demonstrate their willingness to switch channels to suit their specific circumstances and secure the best deal for themselves. Anyone focusing too heavily on a single channel is certain to miss out on opportunities for engagement as and when they arise.

"With this in mind, this could well be the year that mobile really has an impact on sales activity."

Other indicators as to the vital role m-commerce will play this festive period include that 14% of all Google search queries come from a mobile device, and that eBay has been forced to upwardly revise its mobile sales estimates, from $4bn worldwide sales to nearly $5bn this year.

Mobile uptake is one of a number of factors identified as influencing Christmas ecommerce patterns in 2011. 

Almost half of the total online spend (£3.72bn) is expected to be spent within the first two weeks of December. In previous years the trend has been for a few peak days that far exceeded the rest of the month in terms of sales, with last year's high volume sales occurring during the weeks of 29th November and 6th December.

However, in 2011, the economic situation is expected to contribute towards people spreading the costs of Christmas over a few months, with November online sales already relatively high.

Meanwhile, the phenomena of "Cyber" and "Mega Monday" in previous years can be attributed to them falling just after payday for many people who, having browsed products in a shop at the weekend, made the purchase using the fast broadband at work.

Fast broadband connections are now widespread in homes so could level out these weekend peaks.

Chris Webster, head of retail for Consumer Products and Retail at Capgemini, said: "We are still spending, but we’re being selective and this trend will be very apparent this Christmas.

"Technology is evolving and so is the consumer. Gone are the days when we were limited to shopping just on the high-street and were at the mercy of the weather.

"Shoppers have become very savvy, out of both need and convenience – we'll hunt down the best bargains online to get the most out of our Christmas budget, but also because we can, easily and conveniently."

Follow Arif Durrani on Twitter: @DurraniMix

This article was first published on marketingmagazine.co.uk

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