Evidence suggests that as more people are feeling the pinch of higher fuel and household bills, they are seeking savings online.
Could greater use of e-commerce be a silver lining to the cloud of the Credit Crunch?
It's no surprise that the trend for shopping online continues to grow, as more shops are available and people having a positive experience return to buy more online.
But could the UK's economic woes, which are dominating the headlines these days, be driving even more people online to seek savings? As reported by The Scotsman, research by Capgemini indicates this may be the case. The trends it highlights include:
- Internet shopping has increased by 38% compared with the same period in 2007, equal to 17p of every retail pound spent.
- Some retailers are seeing a surge in their online sales combined with a drop in their out of town stores. Could this be due to less willingness to drive to several shops, thanks to soaring petrol prices?
- The greatest increase in sales is in areas where traditional stores, allowing physical contact with the products, would seem best suited; clothing, lingerie and shoes.
So what is happening in the UK shopping landscape? Are petrol prices causing shoppers to think twice before jumping in their cars to head to the shops?
Are congestion and parking prices dissuading users from heading to the town centre? Are more people gravitating to online shopping because it is easier, and allows you to do things you can't do in the real world (like comparing prices for the same product in a few seconds through comparison sites)?
And will this put greater focus on the importance of usability and user experience for online retailers to retain the custom of new online shoppers?
Its probably all of these things and more, on a buoyant trend to shop more online. It is also likely that the increase in online shopping is countered by a decrease in discretionary spending overall, but in any case some interesting changes are happening in UK shopping habits, and perhaps fuelled by the credit crunch and rising cost of living.
My colleague Lorraine has written an article exploring these issues in a bit more depth and with some tips for improving the usability of e-commerce retail stores.
I'd be interested in your thoughts on this especially if you are involved in e-commerce or a 'clicks and bricks' store.
Do these general trends match your experience?
Posted 24 July 2008 09:39am by Chris Rourke with 8 comments
Tags: Shopping
Topics: Comparison Engines, Ecommerce, Online Customer Service, User Experience & Usability, Web Analytics & Optimisation, Web Design
Sectors: Consumer Goods, Travel & Leisure
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Graham Charlton
Online Advertising
24 July 2008 10:58AM
Hi Chris, I wrote about this very issue on my post Web Wins. (http://www.online-marketing-manager.co.uk/2008/07/web-wins.html). I absolutely believe that the downturn will be slower online and share of business taken online will increase.
I also believe that marketing cost per acquisition will increase as consumers will increasingly browse without buying. The desire to purchase will still be high even if the bank balances are not.
24 July 2008 12:23PM
Very interesting post. If online is bucking the more general trend of slower retail sales then it speaks volumes about the power of e commerce in general. If we look at ASOS.com their pre tax profits rose a staggering 117%. Compare this to half empty clothes stores in City centres that I have seen lately.
ASOS have regular sales, and a range greater than any one store I can think of. I am using them to illustrate a point.
Online shopping is obviously more convenient but with a free returns policy it makes no sense to (1) pay for parking, (2) use petrol (3) wander round shops aimlessly.
28 July 2008 09:13AM
It very true.
The cost savings that many proprietors achieve by moving part of their business online has translated to savings on the customer's side too.
It's pretty evident when it comes to online shopping, group buys and so on.
User Experience Director at PRWD
28 July 2008 13:08PM
Hi Chris,
You make some very valid points, and your question on whether the downturn may lead to greater focus on the importance of usability and user experience gets a definitive 'yes, agreed' from me.
Recession or no recession, as usability advocates we know that the retailers who recognise the importance of user experience and customer engagement, and are subsequently willing to invest in testing/researching/improving their stores, are much stronger placed than their competitors who perhaps don't see how important these areas are.
Just briefly with regards your mention of shopping comparison sites, there is potential that these will in fact end up confusing some shoppers rather than helping them towards making a positive buying decision, due in no small part to the amount of comparison sites that are now available.
Paul
Managing Director at User Vision
28 July 2008 15:47PM
Hi Paul
Interesting your thoughts on comparison sites. According to some research we collectively are using these less
http://www.netimperative.com/news/2008/july/2/brits-2018abandoning-price-comparison-sites2019
perhaps for the reason you state.
Regarding the first comment from Richard, your article was useful and with a similar thesis - thanks for pointing it out. I also agree that browsing more widely is likely to happen as well - perhaps to the point where it stows up on some people's web stats for cost per acquisition.
Chris
Managing Director at User Vision
5 August 2008 19:49PM
Maybe bad form commenting on my own blog post, but FWIW this bit of news seems relevant and with some interesting facts
Online shopping to soar as high street slumps
http://www.netimperative.com/news/2008/july/2/online-shopping-to-soar-as-high-street-slumps
Managing Director at User Vision
8 August 2008 13:02PM
Another relevant set of facts on this theme - interesting about the fashion area being so positive - shows a maturing audience with confidence to buy those things online, combined with general trend of better usability in those sites.
Chris
http://www.netimperative.com/news/2008/august/4/high-street-retailers-winning-online-shopping
19 September 2008 14:15PM
A survey was carried out at http://www.laughingdeals.com that revealed shoppers were going online more than using the high street because they could make a more informed decision about their purchases. Shopping online enables a shopper to stick to a list, compare prices and search for discount codes.
Jane