Online sales are beginning to suffer the effects of the recession, with figures out today showing growth at half the level it was last year.
According to IMRG Capgemini, year-on-year growth was 12.3 per cent, while sales were down in June by 1.3 per cent compared to May. As a result, the market research consortium has revised its predictions for the coming year down from 15 per cent to 12 per cent.
It also identified a change in the way customers are using online shopping, with conversion rates – the number of purchases per visit – declining from seven to eight per cent in 2007, to five to six per cent in 2008. It fell to four to five per cent during the first half of this year.
"Our latest results show that online Conversion Rates have been in steady decline," explained head of consulting for retail at Capgemini UK, Mike Petevinos. "Greater levels of competition and an increased propensity of consumers to research before they buy will put pressure on conversion."
"Price continues to be a major factor for consumers when shopping online, with recent research suggesting that 90 per cent of UK households are adopting more prudent buying strategies to cope during the recession," added director of information at IMRG Tina Spooner.
"It is clear there will be challenges ahead in the coming months for e-retailers as they prepare for the lucrative festive season."
However, Petevinos stressed that despite the slide between May and June, he was confident that the rest of the year will see growth.
"The online sales results for the first half of 2009 show a slight slowing of growth, as the recession weakens consumer spending on the web. However, growth still looks set to continue for the rest of 2009 with our predictions being at around 12 per cent."