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Internet retail spending will grow by £12.3 billion to £21.3 billion by the end of 2011, according to new research from Experian and PayPal

Online retailers are set to ride to the rescue of Britain’s retail sector by posting the only growth in British retailing before 2012, according to the forecasts in a new report conducted for PayPal.

The PayPal UK Online Retail Report, undertaken by Experian, forecasts that by the end of 2011, high street sales will plummet by up to £8.3 billion while online retail sales in the UK are set to grow by up to 137% per cent. This expected growth, amounting to as much as £12.3 billion, would see the value of annual online retail sales jump from just under £9 billion to £21.3 billion.

The report is part of a major study for PayPal into the future of online retail and its role during and after the current recession. It suggests that the massive online growth is driven by a new breed of ‘considered consumers’ who are heading online to find better value.

The report forecasts that, from 2008 to 2011:

• Retail sales figures will grow by just 0.2%
• High street sales figures will decrease by up to 1.4%
• Overall non-store (catalogue and online) sales will increase by 49%

The figures would see the online retail market more than double its market share from 3.2% in 2008 to a possible 7.4% of total retail spending by the end of 2011.

“The value of online retail can no longer be dismissed as a sideshow. Its phenomenal growth is not only forecast to deliver sales of as much as £21.3 billion by 2011, but a £12.3 billion increase will also ensure that the entire UK retail sector is growing again by the end of 2011,” says Carl Scheible, managing director at PayPal UK.

“The recession has been tough for many UK retailers as they deal with the slowdown and its knock-on impact on consumer spending,” he adds. “Of course, many of the major high street brands have actually enjoyed the online boom, despite facing challenges in their own stores. The improvements in online shopping will continue to drive consumers until they are spending one in every 14 pounds online.”

Shoppers are more likely to buy from a retailer that sends them emails, even if it does not have an online store, according to new research.A study on the effectiveness of email marketing in the retail sector by Epsilon International found that 56% of shoppers were more likely to buy from a retailer who sent them permission-based emails.

The research also revealed that regular emails help create a ‘halo effect’ which fostered a sense of loyalty towards a retailer. It found that 88% of customers would download and print vouchers received via email and 67% said they would visit the shop to purchase products featured in the email.

While the majority of high street chains send out regular updates and special offers to customers signed up to their email services, independent retailers have been slower to use email as a way of communications with their customers.

Unless they have an online store, many indies still send out twice yearly Sale invites by post and use the telephone to alert regular customers to new stock arrivals.

A poll carried out by Pure London revealed that almost half (41%) of independent retailers do not use email to contact customers. However over half of the retailers that do send out emails said it helps to drive in-store purchases.

Sarah Millet, owner of N Shelley in Billericay, Essex, said that while emails can never replace the personal contact afforded by a telephone call, she is looking to use email to let her customers know about in-store promotions and new collections.

“If you have to contact a large number of customers then email is very effective. We are asking our customers how they want to be contacted and more and more of them, particularly those under 45, say they prefer email.”

Helene Rapaport, owner of Bernard in Esher, Surrey, has been using email to contact customers for a few years and finds it very effective and convenient.

She sends out on average one a month to alert customers to events like the Sale and new ranges arriving in store. “We have found email to be an effective way of communicating with customers and they all say they love receiving them.”

Moving a step further from emails, South London womenswear boutique Siena has recently started contacting customers using mobile phone texts. Around half of the shop’s 4000 strong customer database has signed up to receive regular text alerts.

Owner Caroline Fairnie said: “We found text messages to be more immediate. Everyone seems to like it and if someone is out and about when they get a text they will often come straight here.”

An added bonus of both email and text messages is that they are both perceived as more environmentally friendly than printed promotions. “”People have a big resistance to post these days. They don’t like the idea of chopping down trees,” said Fairnie.

June 2009. Microsoft launched its much anticipated “Google killer” of a search engine – Bing.com. Bing is the software giant’s answer to Google, the currently undisputed search kings that have dominated the search market for the best part of the last decade.

Before the launch of Bing.com, Live.com received 98% of its traffic through MSN rather than direct navigation so it’s no surprise that Microsoft are investing between $80m to $100m on branding and marketing their new search engine (sorry, decision engine).

One thing that jumps to mind is how strangely familiar Bing looks. The look and feel is most certainly Googlish, but why reinvent the wheel right? To add to this familiarity, results themselves seem to be very similar to the late Live.com results, rousing speculation that Bing is merely a re-skin of Live.

According to Microsoft, it’s best to think of Bing not as a search engine, but a decision engine. Bing will focus on four verticals: making a purchase decision, planning a trip, researching a health condition, and finding a local business.

While at the first glance it may not seem as though Bing is bringing anything dratiscally different to the search table, there are a couple of features which may snag the interests of the Google dependants in this world. The related searches on the left hand side of results pages may encourage further refined long tail searches.

Additionally, where video results are integrated, users can hover over the video thumbnail to see part of the video before clicking though. Bing search result listings also have an extend area which lists a brief snippet of the content within the destination site as well as top links within the site.

Microsoft CEO, Steve Ballmer said in a statement about the launch: “Today, search engines do a decent job of helping people navigate the Web and find information, but they don’t do a very good job of enabling people to use the information they find. When we set out to build Bing, we grounded ourselves in a deep understanding of how people really want to use the Web. Bing is an important first step forward in our long-term effort to deliver innovations in search that enable people to find information quickly and use the information they’ve found to accomplish tasks and make smart decisions.”

www.bing.com

Easter falling in April this year but in March last year, together with warm sun this April but cold and rain last April, however, make comparisons difficult, says the British Retail Consortium

 
UK retail sales values rose 4.6% on a like-for-like basis and rose 6.3% on a total basis, from April 2008, when sales were very weak in the cold wet weather after Easter fell in March, the British Retail Consortium has reported. Easter and the warmer weather boosted both food and non-food sales. In non-food, clothing, footwear and outdoor leisure showed the best growth but big-ticket homewares and furniture sales remained difficult.

Non-food non-store sales (internet, mail-order and phone sales) in April were 12.5% higher than a year ago. “Non-store grew faster than shop sales but the gap in growth rates narrowed significantly as store sales did better than in recent months, says Sharon Hardiman, the BRC’s head of non-store retailing.

“Online and catalogue sales were boosted by extra customer interest in many of the same things doing well in stores — DIY, outdoor furniture and toys, sandals and summer clothes,” she added. “That took non-store sales growth back up to virtually the same rate seen in February but it was well below the rates seen in December and January, showing this route to customers is not immune from the effects of recession.”