Reports Paint Positive Picture of Britain’s Web Industry

27 November 2001

Two newly released reports offer some cheer for Britain’s internet sector.

A survey by online shopping research firm Interactive Media in Retail Group found an 18.3% rise in web purchases in the UK from £366 million in September to £433m in October, up more than 145% year-on-year. The figures compare well with the 0.1% decline in offline retail sales recorded by the Office of National Statistics over the same period.

The rate of monthly growth is close to the 20% rise between September and October 2000, suggesting e-tailers are in for a bumper Christmas. Shoppers are expected to spend around $1.75 billion online during the holiday period, according to contributors to the IMRG’s e-tail index.

Separately, a study conducted by ARC on behalf of the Incorporated Society of British Advertisers found that internet ads are used by two-thirds of Britain’s biggest companies, half of which intend to up their online spend in 2002. Just 12% plan to reduce their ad expenditure on the medium.

ISBA said it had found many marketing directors were keen to advertise online, but were hindered by scepticism as to its benefits at board level. “The interesting thing is that where companies say their new media strategy is working, there tends to be someone at board level championing the cause,” said Debbie Morrison, director of membership services. “Those companies are spending more money in new media because there is someone senior who recognises how important it is.”

Other findings include:

* One in ten advertisers claim to spend over £1m on internet marketing.

* Nearly two-thirds sell to customers via the web – half said they expected growth in e-commerce; a meagre 2% anticipated a decline.

* A majority of companies with a consumer website will boost their investment in it next year. The average amount poured into such sites is presently £385,000.

* The marketing department is often in charge of online activity, with company websites funded from marketing budgets. Only one-third of firms devote separate cash to internet operations.

News sources: Financial Times;