With strong growth in 2010, internet retailing is blazing ahead of all other retailing channels and is coming out of the recession even stronger, boosted by shifting consumer attitudes. This briefing aims to examine the contrasting opportunities in both developed and emerging markets and highlight retailer strategies in key product areas.
The report discusses the impact of m-commerce, coupon sales and flash sites and their influence on the internet retailing channel’s future growth.
Key findings include
- The recession had a positive influence on internet sales as it helped drive more consumers online. Consumer spending is expected to remain squeezed and will not recover immediately.
- Consumers are in search of value and are switching channels. The internet has been one of the key beneficiaries of this trend, which has led to an increasing share of online sales in almost every industry covered by Euromonitor International, from apparel to pet care.
- Internet retailing was the fastest growing retail channel in 2010, both globally and on a regional basis. Latin America and Asia Pacific outperformed all other regions globally.
- There are wide differences in online sales in developed and emerging markets related to available infrastructure and consumer attitudes. PC and internet penetration are still limiting factors to wider adoption in emerging markets, although availability of the relevant payment and delivery systems also poses a major challenge. Retail infrastructure level of development also affects internet retailing.
- Amazon remains the biggest online player, following a strategy of wide product and geographical coverage and very competitive prices. Media products account for a major portion of Amazon’s sales. Kindle and its cloud service are at the heart of Amazon’s media strategy.
- Online grocery sales are still at an early stage of development. The UK is the most mature market for online food and drink sales, with the country’s major grocers all having an online presence. In most other markets, grocery retailers have focused on selling non-groceries online.
- Consumer electronics is a key product category for the largest online players such as Amazon, Apple and Dell. Store-based retailers are finding that integration of online sales into a multi-channel strategy is key to a strong performance.
- M-commerce has come to the forefront of internet retailing. Japan leads this area thanks to the early adoption of key technologies. Simplicity and ease of use are key to successful implementation.
- Frugality is proving to be a winning business model as indicated by the meteoric rise of coupon and daily deals such as those offered by Groupon.
- Internet retailing will continue its strong growth performance over the next five years, significantly outperforming the wider retail market. The majority of sales will be generated in developed markets, although China is set to become the second biggest market in 2015.
For further insight, please read Euromonitor International’s recently published global briefing: Internet Retailing Blazing Growth Path.