The UK's Internet economy is set to grow by around 12% this year, compared to lower overall growth in the wider UK economy. You only have to look at the first two months of 2013 to see stories of established high-street chains like HMV, Blockbusters and Jessops being hit by competition from internet retailers.
HMV and Blockbusters especially lost out in the long run to online competitors like iTunes, Amazon and LOVEFiLM. Given their shared young, tech-savvy customer base, perhaps capitalising sooner on the growth of online opportunities could have helped them in this highly competitive entertainment sector.
It is estimated that £78 billion was spent online in the past year, so make sure you're not missing out when it comes to growing your customer base online. Understanding the motivations behind the rise of internet shopping can help you optimise your website and improve the online shopping experience for your customers.
So why are consumers in the UK buying one third of their purchases online? Here are five key reasons why people shop online, and how your business can benefit:
If enough people came into your shop to ask for something, you'd consider stocking it, and you can use your website analytics to provide you with the same information. You can get insight from the keywords bringing visitors to your website, as well as what people are searching for when they're there, to jump on trends and fill gaps in your existing ranges.
Make sure you're targeting potential customers earlier in their buying cycle. Whether it's clothes or conservatories, 96% of people research their purchases online before committing to buying. So it's important to provide all the information they need for comparisons up front - detailed product information, pricing, availability, delivery options and timings. This is also a great opportunity to bring in reviews and endorsements from previous customers: 72% of consumers trust online reviews as much as they would a personal recommendation.
You can connect with customers when they want to spend money. Social media and e-newsletters make it possible to target communication to your customers around times when they're most likely to buy - paydays, lunchtimes, after work, after the morning school run. This is when insight into your customer demographic and their online habits becomes vital for your marketing strategy.
It's important to make your purchasing system easy and stress free. Keep your checkout forms as brief as you can. Also, remember that although online customers understand that they won't receive the order immediately, offering a range of delivery options will satisfy those impatient shoppers and minimise the amount of online baskets abandoned at the last minute.
When growing your customer base online you're not limited to a geographic area: research shows that people in the UK still prefer buying from British companies with four out of five people preferring .co.uk websites when searching online. With the right website, small businesses can reach as many people as the biggest high street chain or supermarket. While local custom can be your bread and butter, don't forget to factor in the wider UK audience for your SEO, advertising and marketing strategies.