The IMRG Senate Christmas statement makes great reading. Here it is in full:
Christmas is coming and it is going to be bigger than ever this year online with over £13.8 billion to be spent by the UK’s 27 million e-shoppers during the festive season, according to Forrester Research*, which compared to IMRG’s 2006 data is up 42% on last Christmas.
So what is contributing to this huge uplift in spend online? Shoppers are migrating online to find more choice, convenience and better prices. But more than that, the internet is all about independence, immediacy, modernity, attitude; it’s where many people now feel most comfortable. Some 61% of UK homes are now connected to the internet, 15.2 million households, according to National Statistics, and with 84% of online households in the UK using a broadband connection, shopping online has never been quicker and easier. And as well as sales going up, consumers’ confidence in shopping online is also rising.
According to the latest IMRG Customer Service Index by eDigitalResearch and ipoints, confidence in web site security rose two percentage points in the past quarter to 75.6%. Commenting on this Gerald Kitchen, CEO of SecureTrading said that “growth is set to continue as consumers become more comfortable with the security aspects of trading and purchasing online. It was not long ago that consumers were uncomfortable with even purchasing low ticket value items like a CD. Today, we are seeing consumers purchasing items costing thousands of pounds”. The IMRG Customer Service Index also revealed that customer delivery satisfaction had risen to 80.2%.
The demographic profile of the web is changing from the young male dominated scenario of recent years and this is feeding into the sales growth online.
Women aged 18-34 are now accounting for 21% of all time spent on computers in the UK, which equates to 13 minutes out of every hour online, according to Nielsen/Netratings. And there are twice as many women aged 18-34 active online as there are girls under 18 or women over 50. Over 50% of women under 25 now buy clothes online every month.
At the older end of the age spectrum around 30% of total time spent online in the UK is accounted for by the over 50s, with the number of broadband users aged over 55 growing at nearly twice the overall adoption rate among European internet users, according to the European Interactive Advertising Association. Also in the UK internet users aged 55+, the ‘silver surfers’, are the 2nd largest demographic group online, according to Hitwise. The UK internet population is now split almost equally between males (51.5%) and females (48.5%), according to the latest Nielsen/Netratings.
Reflecting this change in profile of online shoppers, retailers are seeing buying patterns altering on their sites and in some cases are opening new departments and product areas to capitalise on these new customers, especially in the run up to Christmas.
Commenting on how sales patterns are reflecting the change in online user demographics, Ulric Jérome, Managing Director of IMRG Member Pixmania says: “We have seen sales growth among the older generation of ‘silver surfers’ and women. They now see the value of technology and have more disposable income than previous generations, meaning technology products are becoming a part of the DNA of their lifestyle. They now embrace technology and understand the ease-of-use and convenience of online shopping better than ever.”
Another IMRG Member, Amazon, have launched four new stores on their UK platform this year and look to capitalise with a broad product range offering in the run-up to Christmas. Brian McBride, Managing Director for Amazon.co.uk said: “2007 has been a great year for Amazon.co.uk. Not only have we seen the launch of four new stores – Sports & Leisure, Jewellery & Watches, Shoes and Baby – but we have seen record breaking sales for the likes of ‘Harry Potter and the Deathly Hallows’ and ‘The Exclusive Catherine Tate Comic Relief Special’ DVD. The proliferation of broadband in UK homes is certainly allowing a greater proportion of the UK public the opportunity to shop online. This means that every age group, across both sexes, is now well represented in the share of internet retailing spend. Whilst there are certain areas that have seen accelerated growth, like the so-called ‘Silver Surfers’, there will be a continued strong increase in internet retail spend across all groups of the UK adult population for a good time to come. This promises to be our biggest Christmas on record and we look forward to serving millions of customers with an incredible product selection, at customary low prices and with a delivery option to suit every shopper.”
The strength of the female purchasing power is no better illustrated than at Play.com, where their influence is being felt in the all-important top selling albums for Christmas. Commenting on this Stuart Rowe, spokesperson for Play.com said: “What is going to be number one selling album at Christmas is the burning question on everyone’s lips. It’s looking set to be the battle of the divas, with Play.com already receiving massive pre-orders on Leona Lewis, Kylie Minogue, Celine Dion and the Spice Girls. However when it comes to gifting, anything goes. The Now That’s What I Call Music series always does well with the general public, and Live Lounge 2 and Radio 1 Established 1967 are already proving very popular choices with our customers. If we had to suggest what will be the biggest seller on the site as a gift purchase, we think it’ll be a 3 way fight between Kylie, Leona and Westlife, who should never be underestimated in the Christmas market – last year they took on both Oasis and the Beatles and won. Music is a great gifting option at Christmas. It is affordable, accessible and instantly rewarding.”
Are Christmas sales online heading for another record amount? With more people online, greater choice and availability and even more parcels being delivered than ever before it certainly looks that way. Jonathan Wall, Marketing Manager at dabs.com, observed: “Shoppers continue to use the internet as an easy way to seek out best value, especially at Christmas time when budgets can be tight. Retailers such as dabs.com have used the flexibility of their online store to create special “bundle deals” which offer extra discount and help stretch the festive budget even further.” Val Walker, Royal Mail’s Head of Multi-channel Retail Marketing, said: “Royal Mail is geared up to deliver a record breaking online Christmas and expects to handle more than 100 million gifts and presents ordered on the internet during the festive period. Royal Mail has responded to the needs of the online shopping community, both shoppers and retailers, with the introduction of a new service which improves the delivery experience. ‘Royal Mail Tracked’ enables retailers to provide their customers with a tracking number when the goods ordered are dispatched so that they can track the progress of their delivery themselves. The service also enables retailers to give their consumers the opportunity to specify an alternative delivery point, such as a porch, shed or a neighbour, should they not be at home to receive the item. This new service builds on the success of Royal Mail’s Local Collect service which enables online shoppers, who are not at home to take delivery of an item that cannot be posted through the letterbox, the opportunity to ask for it to be taken to a Post Office branch near their home or work.”
Jo Evans, IMRG’s Managing Director commented: Like a lot of people, I have already begun my Christmas shopping without having to battle with traffic and crowds, by buying online. I have thousands of shops available to me, and if they are displaying the ISIS / IDIS logos, I know they are trustworthy and reliable, and I can shop safely and securely receiving my purchases at home in good time for giving to my family and friends.”
Footnote: * Source: “Europe’s 2007 Christmas: An Online Retail Wonderland”, Forrester Research, October 2007.