According to global business consultancy Capgemini, and U.K. e-retail association Interactive Media in Retail Group, E-commerce in the United Kingdom will increase approximately 11.5% this year, to $138.0 billion (87 billion pounds) from $123.7 billion last year. That growth is down from 14% year-over-year growth in 2012, says the report.
Andrew McClelland, chief operations and policy officer at IMRG, says “... in spite of continued tough trading conditions... as consumers concentrate on paying down debt... we are forecasting growth... “
Mobile commerce in the country boomed in 2012, with sales via smartphones and tablets up 304% over 2011.
Chris Webster, head of retail and technology at Capgemini, notes that “... visits and sales from either a smartphone or a tablet device are nearly four times higher than last year... reaching a point where we are spending longer on our phones shopping than making calls...”
Shoppers from U.K. online and catalog retailer, Shop Direct Group, bought more than 61,000 tablets in December and 91,000 in the six-week holiday shopping period, the retailer says. Kids’ tablets were the top two items on Shop Direct’s toy bestseller charts in 2012, it says.
The big themes of 2012 were mobile and personalization and both will continue to be at the forefront of the U.K. e-commerce strategy for 2013 and beyond, pointed out Gareth Jones, group retail and strategy director at Shop Direct.
“Customer adoption of m-commerce continued apace both in the run-up to and after Christmas, with sales via mobile devices representing 37% of total online revenue,” which represents an increase of about 20 percentage points, the retailer adds.
In December 2012, U.K. e-retail sales increased 17.5% year over year, and 12% from November 2012, says the report. However, conversions in the last two months of the year were down slightly. Combined with the season’s strong sales, that decline suggests that U.K. consumers are increasingly using the Internet to research purchases, online and offline, before buying. The report continues by opining that add that the continued economic slump in the U.K. could be driving consumers to use the web to seek more deals.
Concurrently EMarketer, citing Portio Research, says that at the close of 2012, the UK had 83 million mobile subscribers, according to January estimates. Of these, 36 million were smartphones and 47 million were non-smartphones. representing a market penetration of 130%. Development in the market is happening around the shift toward smartphones and away from feature phones.
By 2016, Portio Research expects that roughly three-quarters of UK mobile devices will be smartphones, creating a mobile advertising environment in which smartphones are the rule, not the exception.
UK Mobile Connections (Millions; by Type of Device)
Source: Portio Research & eMarketer calculations, January 2013
According to eMarketer’s forecast, UK smartphone penetration will reach 78% of mobile phone users in 2016, stretching its lead as the country with the highest smartphone penetration in Western Europe. eMarketer projects that the UK’s smartphone penetration will overtake the US’s in 2016 as well.
For more information from the Interactive Media in Retail Group, please visit Internet Retailer here, and to see the eMarketer report, please go here.