E-retail philosophy finds believers

Some time ago retail analysts were predicting that the end of the traditional retail sector was nigh.

In the age of technology and with an understanding of what the internet could offer as a fully functional window into the retail sector, the days of bricks and mortar stores were numbered, they said.

There was a realisation that the internet had the capacity to deliver products to your door in a matter of days, without the angst of sitting in endless traffic, fighting for a parking space or jostling your fellow shoppers at the checkout, which was, possibly both understaffed and overworked.

Aside from ending our high-street shopping woes, leading industry spokesmen were suggesting that shoppers would soon buy everything from the comfort of their homes, negating the need to ever step outside again. This period of global, house-based, self-confinement obviously never materialised but, as with most big ideas like this, the real potential of what the internet can offer is only now being realised.

The end of the real shop is certainly not being transcended by the virtual one, as was once previously thought, but there are subtle changes in the retail paradigm that we as shoppers have traditionally been used to.

Online retail or, to give it it's more formal industry name, e-retail is now as much part of the sector as any other and is equally, if not more important in how this industry moves forward during this period of economic uncertainty. With consumers looking to curb spending, especially in those areas deemed to be unnecessary, such as restaurant meals, it is likely that we will see more of the trends that Domino's Pizza is witnessing in the UK - where growth in online ordering grew 74 per cent in 2008, with these sales now accounting for a substantial 56 million or 23 per cent of their overall sales.

Moreover, the online index for e-retail in the UK recently revealed that, in spite of the current problems with the high-streets, including many retailers going into liquidation or the hands of the administrators, online sales in January increased by 20 per cent over last year.

One of the more obvious conclusions that we can draw from this is that, as a population we're spending more and more time at our desks and therefore, as our time online increases, so will our spending online.

Retailers have been quick to realise this and now it is becoming easier and much more commonplace for retailers to plan online marketing and sales strategies that can then be rolled out into the traditional stores, rather than vice-versa, which once was the case.

As a consequence the ability of e-retail to transcend the difficulties that others areas of the sector are subject to, will define the position and importance that it holds in the future.

For the moment though, whilst e-retail isn't going to make ghost towns of our high streets anytime soon, it is offering some very positive and profitable solutions at a time when most areas of the sector are taking some serious hits. Secondly, with the easy ability of websites to track and monitor visitors and purchasers, online stores offer retailers the ability to win serious customer loyalty and the chance for much more repeat business.

- The writer is Head of Retail Services, GRMC Advisory Services.