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Thursday 11th September 2008

Cash strapped consumers turn to the Internet

As global food supplies continue to be stretched resulting in higher prices, UK consumers head online to make savings...

Cash strapped consumers turn to the internet... High streets around the UK are experiencing somewhat of a desertion by consumers who are increasingly cash strapped due to the continuing rise of household bills and motoring costs, not to mention a summer which hasn't particularly encouraged people outdoors. But as well as sheltering from the summer storms, consumers are opting to shop online as a convenient and cost-effective alternative.

The UK's online grocery market has experienced significant growth in recent years due to the proliferation of broadband internet throughout the country providing our homes with faster and more reliable internet connections. The recent increases in food prices have driven this even further with consumers not only looking to save on their grocery bill itself but also make savings at the petrol pumps.

Supermarkets themselves have invested heavily in this important sales channel recognising its vital role in their long term success. Consumer confidence in online security combined with product selection and home delivery satisfaction has helped to convert and retain their online customers.

Advancements in website design has led to shoppers being offered a shopping option that is more efficient and convenient than having to get in the car and endure the aisles and checkouts at their local store. Furthermore it allows retailers themselves to advertise their promotions and special offers with a great deal more effect and without the need for costly in-store promotional material.

It is not only the high street giants that are taking advantage of what the increasing online marketplace has to offer, but also independent retailers and suppliers, many of which are suffering particularly badly from the challenging economic climate. Businesses that have perhaps relied upon trade sales as their primary source of income are opening up online stores to increase sales and secure their future growth and development. Of these, organic food suppliers, confectioners and farm shops have been among the first to recognise the internet's ability to target customers directly and increase their brand awareness, helping them to establish and retain a loyal customer base.

Our attitudes and the way we interact with the internet has undoubtedly brought about significant changes in the way we shop and this is clearly reflected by the continual increase in online shopping. Already during the first half of this year UK consumers have spent £26.5 billion with internet retailers, up from £19.2 billion in the same period in 2007. Furthermore internet shopping is expected to account for between 30% and 50% of all retail sales within the next five years.

Figures from the IMRG (Interactive Media In Retail Group) Capgemini Index.
In association with www.foodinternational.net