British internet shoppers will increase the amount they spend online by 36% over the next two years, and will drive the recovery for the UK’s retail sector, according to a new report sponsored by PayPal.
Bricks-and-mortar store sales are expected to grow just 1% over the next 18 months, according to the report; online spending will double its share of the retail market, increasing some £8 billion to be worth £30.6 billion by the end of 2012. As the report cheerfully points out, this is “almost equivalent to the total £32 billion worth spending cuts announced in the recent Budget”. Or in terms of what’s in your pocket: one in every ten pounds spent will be spent online.
Carl Scheible, Managing Director of PayPal UK, comments: “Two thirds of online shoppers are now convinced their money goes further online compared to less than half who believed it last year.”
Broken down by category, consumer spending has increased in travel, groceries, furniture and homewares, clothing and small electrical appliances. Technology and financial services have been the losers, with both categories seeing big drops in spending (do we feel sorry for the financial services industry? not so much).
But – and this should cheer merchants – online doesn’t only equal cheap. Carl goes on to say: “The growth of online shopping is not just about saving money, it’s also about saving time. In the last year we’ve seen an 11% increase in the number of online shoppers who say buying online does just that.”