Internet-only stores to overtake retail giants' online sales this year
New and nifty online-only stores, from Amazon to Made.com, are on track to generate more sales this year than the websites of traditional high street retailers
5:15AM BST 31 Jul 2015
4 Comments
Sales made by internet companies without physical stores, such as Amazon and Asos, will surpass online sales of store-based UK retailers for the first time this year
So-called "etailers" are expected to generate £21.8bn-worth of sales in 2015, an increase of 18pc from last year, while traditional stores should grow their online sales by 11pc to £21.5bn, according to a report from market research firm Mintel.
Richard Perks, director of retail research at Mintel, said: "Online is putting consumers back in control. They are better informed and much less inclined to give a retailer the benefit of the doubt."
Mr Perks added that this trend could reverse as high street stores, which have been slower to capitalise on surging demand for online shopping, compete on price and amp up their internet offerings.
"Currys and Comet were like rabbits in the headlights – they didnt know what to do," he said. "But store-based retailers are becoming more confident now."
Amazon, the largest retailer without a physical presence, has long been rumoured to be considering setting up shop on the high street, with chief executive and founder Jeff Bezos admitting in 2012 that he "would love to open physical stores".
Also for the first time this year, online shoppers will spend more on electrical goods than fashion. Sales of electronics will rise 18pc to £12.6bn, while sale of clothing and footwear is set to grow 14pc to £12.4bn.
Almost half of electronic goods are purchased online, compared with 19pc of fashion items and 6pc of groceries.
However, food shopping accounts for a fifth of all internet sales, making it the third biggest sector.
Some 45pc of physical books and 42pc of hard-copy music and video items are bought online, but these divisions account for a combined 3pc of all online sales.
Mr Perks pointed out that the challenge for purely online stores "will be to provide the levels of service that store-based retailers are able to offer.
"We are starting to see some of them open physical outlets but this is likely to increase their costs and further erode the price difference between in-store and online."
Overall, online retail sales are on track to hit £43.3bn this year, accounting for 12.7pc of total expenditure. Mintel estimated that by 2020 almost a fifth of shopping will be done on the internet.
