Britain is mature but nearly all of Europe is not

RetailMeNot and the Centre for Retail Research recently got together some comparative statistics for online retail sales in GB, the USA and Europe (Great Britain, Germany, France Italy, Spain, Sweden, Poland and the Netherlands).

At an overview level they foresee in 2014 online retail sales of:

  • USA €306.0 bn
  • Europe €155.3

So as near as makes little difference the US is double Europe. Britain at £45 bn or €62.8bn represents the largest European market at just over 40% of the total. Germany is forecast to be the next largest at €49.4 or just over 30%.

In their accompanying infographic they show, inter alia EVERY bricks and mortar or high street market in all 9 countries contracting in 2014.

Their view is that these 9 countries are at three  different “… stages in online market development and business strategy:

  • Maturity – market share of 9.5% or above, 55%+ of the population are internet shoppers, rapidly developing mobile use (15%+ of all online in 2014), multiple online providers throughout each sector and 12+ purchases pa by each shopper.
  • Mid range – market shares of 6.5% to 9.5%, a wide range of suppliers, more than ten purchases pa per shopper, 45% are online shoppers and a smaller mobile use.
  • Immature – online market share below 6.5%, patchy takeup (regionally or demographically) of online retailing, fewer than ten purchases pa, and some trade sectors are comparatively less developed.”

We wouldn’t disagree but we think one of the key drivers of market change in online retail sales is likely to be in the food sector where eg in Britain currently only something like 3.5% of this huge market is sold online. Excluding automotive fuel in January in Britain over 47% of the TOTAL retail spend was on food!

This research foresees a huge expansion in online mobile (smartphones & tablets) device retail sales  this year with Europe increasing from 8% to 13.1% of the total and in the US a comparable increase from  13.8% to 19.9%. It could be said here that Europe is a year behind the US!

Britain again leads Europe with, they forecast, 17.6% of online retail sales being made using mobile devices in 2014.

A most impressive piece of work

We repeat below the details they provide on their methodology.

Methods

The statistics are problematic as state statistical research organisations often tend to underestimate the size of the sector, because conventionally they are best at collecting information from companies that own retail shops. There can be problems in determining online sales from abroad, because UK statistical authorities may not be fully aware of their scale, foreign firms may not wish to comply fully with UK statistical needs, and sampling may be problematic as a result of rapid sector change. There are important issues about whether to include mail order when it is mainly online and how to account for partial online ordering such as click and collect. Other issues include the definition of ‘retail’ where US authorities seem to combine food services (cafes and restaurants) within retail, which is not the case in Europe. However in Europe and the US fuel for cars is normally included as ‘retail’ but as this is not the retailing of goods and would be difficult to sell over the web we have attempted to adjust our estimates to take account of this.

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