With online spend predicted to account for 15.5% of Technical Consumer Goods sales by the end of 2011, GfK predicts Australia will follow in the footsteps of Europe’s massive online growth.
GfK Retail and Technology Australia has analysed the online retail trends in Europe and claims Australia will see similar growth patterns emerging.
The European market has seen consistent increase in the proportion of consumer spend online. In 2006, online spend was 6.3% of total Technical Consumer Goods (TCG) sales, increasing to 13.6% in 2010. In the early half of 2011, growth continued to 14.9% of total TCG value and GfK predicts online sales will account for 15.5% of consumer spend on TCG by the end of the year.
Given the current growth rates, it is predicted that the proportion of sales will increase to 17% of total European TCG spend by the end of 2012.
The strongest categories in online spend in Europe are IT (23% of sales from online spend), photo sectors (20% of sales from online spend) and big-box retailing (13% accounting for consumer electronics online spend and 10% accounting for major domestic appliances online spend).
Another trend to emerge from the data is the higher value of products purchased online. “Whilst the online channel is undoubtedly a discount channel, the products sold through it tend to be of a higher-specification and higher value to begin with. In simple terms, this trend says to online retailers that it’s crucial their product mix is right for the channel,” says Chris Peczalski, Account Director at GfK.