Online retailers report strong growth

Web retailing is growing faster in the UK than in the US

A quiet revolution is taking place on the internet despite the recent demise of several dot.com ventures, according to the online retailing industry in the UK.

"The internet has continued to be a massive growth area for us despite a downward trend in general activity elsewhere resulting from 11 September," said the Automobile Association's head of e-commerce, Paul Richards.

"TheAA.com has beaten 2001 targets, especially in insurance and motor related activity," he said.

"The internet penetration of direct sales is still increasing at a strong rate," agreed the managing director of the online clothes retailer Boden, Julian Granville.

"Over 22% of sales were taken on the internet in February, up from 18% of sales last year."

Fast growth

Online retailing is growing ten times faster in the UK than it is in the US, according to the industry body Interactive Media in Retail Group (IMRG).

Consequently, online retailing in the UK is already worth more than double its US value as a proportion of all retail, the IMRG said.

"E-retail as a proportion of all retail is just 1.2% in the US, but close to 3% in the UK," IMRG said.

Not just bargains

The IMRG also set out to dispel the myth that online shoppers are merely bargain hunters.

"The reverse is certainly true at Virgin Wines," the IMRG observed.

"Our customers now spend nearly twice the UK average on a bottle of wine from Virgin Wines, and this trend is only getting more pronounced," said Virgin Wines' finance and commercial director, Andrew Webb.

"Our average bottle price [rose] nearly 10% on last year.

"The reason for this is that our customers find buying wine on the internet a more informative and consistent experience than shopping through more traditional channels," Mr Webb said.

"They still use these other channels but tend to use them for more commodity purchases, everyday drinking wine, along with their groceries."