Online Christmas Retail Sales Expected To Reach Five Billion

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11th December 2013 11:23 - Retail

Online retail sales have been forecast to hit £5 billion this Christmas, an increase of almost a fifth (20%) on last year, while total sales over the festive season are predicted to top £40 billion, a rise of 3.5% on 2012, according to forecasts from Deloitte. It says flexible delivery for shoppers could prove to be this year’s Christmas battlefield. Retailers are preparing themselves for the online rush with an estimated 20,000 click-and-collect points across Britain.

Deloitte said that clothing stores would receive a boost if the recent cold weather continued and that tables and games consoles could lift sales at electrical retailers. Homeware and department stores are also expected to do well.

Meanwhile, in a Royal Mail survey of 500 small and medium sized online retailers, just a quarter (23%) said they regarded traditional retailers as their main competitors. The survey predicts that price promotions will be critical for online retailers, and shows that a third have invested in apps and other IT upgrades to make it easier for shoppers to buy through their smartphones this Christmas.

Ian Geddes, UK head of retail at Deloitte, said:

"The forecast will provide some Christmas cheer for retailers. Shoppers are expected to loosen purse strings off the back of rising consumer confidence and improving economic conditions. After last year's click-and-collect Christmas, consumers' expectations around flexible delivery over the coming festive period are higher than ever before. Store collection is now seen as a basic offering and those retailers without this capability will struggle to convert online sales and lose resulting footfall in-store."

Ben Perkins, Head of Consumer Business Research at Deloitte also commented on the situation:

“Some retailers are able to deliver within 90 minutes, whilst others are offering Sunday deliveries, drive-through pick-up points and even collection from your tube station within four hours of ordering… However they must balance this against the cost of delivery, and recognise the infrastructure and systems that need to be in place to ensure a reliable and efficient service.”

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