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Viewing report
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Home Shopping Market Report 2011
Key Note Publications Ltd, June 2011, Pages: 123
The total UK home shopping market was valued at an estimated £58.61bn in 2010, a 32.2% increase on 2006 figures. The home shopping market is estimated to have accounted for 20.5% of total retail sales in 2010, after increasing its share of the market year-on-year since 2006. This growth is principally down to the strong performance of the e-commerce sector during the review period and, in particular, which has helped to boost the total home shopping market over the past 5 years. However, in contrast, the other sectors of the market — general mail order, direct marketing and direct selling — have all declined in value since 2006.
With many consumers now having easy access to a broadband Internet connection, usage of the Internet has increased significantly in recent years. This has boosted sales of products via online retailers, thus driving the overall home shopping market in turn. Non-typical users, such as those belonging to older age groups, have also become more accustomed to utilising the Web.
The decline of the other home shopping sectors has caused a number of retailers in these sectors to expand into the e-commerce sector instead, for example, by launching their own online shopping website where customers can peruse products and order items via the Internet. Other home shopping retailers have also taken advantage of the wide reach of the Internet by advertising online, despite continuing to distribute via other channels. Interestingly, the catalogue sector of the market has become increasingly integrated with the e-commerce market, and the two distribution methods are no longer distinctly separate in some companies now.
The home shopping market is highly competitive. Most retailers, including traditional-sellers, now have a presence on the Internet, while companies that are solely engaged with e-commerce, have enhanced their status in the marketplace through the continual launch of new brands. Such companies often have an advantage when launching new brands due to their existing position and recognisable name.
The UK is believed to have the largest home shopping market in Europe and penetration of online shopping in the UK is thought to be the highest in the EU. Germany and France are also major players in the e-commerce sector and, when combined with the UK, are believed to account for around 70% of total online sales in Europe.
Over the next 5 years, Key Note estimates that the home shopping market will grow by 63.6%, reaching £106.19bn in 2015. The e-commerce sector is expected to be the main driver of this growth, while the general mail order, direct marketing and direct selling sectors are likely to continue to decline. Increasing Internet usage by older consumers is expected to boost growth in the e-commerce sector in the UK, particularly in light of the rising aging demographic within the country, while further advancements in technology, such as the rise of mobile shopping, is likely to further drive sales in the sector.
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