The fact that a record £636m was spent online on Christmas Day on top of an expected UK spend in excess of £17bn online in the run-up to Christmas reinforces the importance for suppliers and manufacturers to understanding how category management online works.
That’s the message from category, customer and shopper management specialist Bridgethorne after Experian and online retail trade association IMRG reported that number of visits made to shopping websites was up 25% on last Christmas Day, to an estimated 142m. This follows the earlier Centre of Retail Research figures, which forecast a growth of 19.5% online, compared to the £14.5bn spent in 2013. Ecommerce sales, they said, would account for 23.4% of all sales in the six-week Christmas period from mid-November to Christmas.
John Lewis is the first retailer to confirm that online purchases have driven sales growth over the Christmas period. It reported that total like-for-like sales rose 4.8% to £777m in the five weeks to 27 December, with online purchases up 19%.
“This Christmas demonstrates that understanding category management online is going to be core,” said John Nevens, co-founder of Bridgethorne. “Online is not the future, it is the here and now and it continues to evolve. Online will be the fastest growing channel over the five year period, fuelled by new market entrants, lower delivery charges and greater shopper engagement with mobile technology.”
Although a growing proportion of e-commerce sales took place over mobile devices – an estimated 29.8% of all online Christmas sales were over tablets and smartphones, 301% more than at the same time last year – the majority of sales still took place over PC and laptop.
Nevens says that over the next five years, the three fastest growth channels of convenience, discount and online will increase their sales by £31.3bn, equivalent to 110% of market growth.
“Most shoppers shop across all channels and through all media. In a digitised retail world, the shopper dictates the purchase journey, not the retailers. We operate in a multi-channel world so ensuring the shopper’s journey is seamless and consistent across all channels is a priority. Retailers expect suppliers to organise themselves on this basis too. Suppliers must adjust to this new reality. Retailers want to see suppliers having a clear online strategy, being able to deliver the basics, ensuring that their plans are integrated and that their channel plans act as one.”
Nevens says that the challenge facing suppliers, now and in the future, is not only to talk the talk of shopper and category, it’s to walk the walk too and that’s what Bridgethorne is working with clients to do.