An international study from RetailMeNot has revealed online spending is predicted to reach highs of £182.80bn in Europe this year, with UK sales set to surpass £60.0bn alone.
The past year has once again benefitted from a strong growth in e-commerce across Europe, with total retail spending online rising from £111.23bn in 2013 to £156.67bn in 2015, an increase of 40.9%.
These figures are driven by the increased use of mobile, which RetailMeNot predicts will develop even further in 2016. In fact, this year British consumers are predicted to make 36% of purchases online via a mobile device. The international research comes from RetailMeNot, the world’s largest marketplace for digital offers and operator of VoucherCodes.co.uk, and has been conducted by the Centre for Retail Research. The research analyses m-commerce trends across the 8 key European markets (France, Germany, Spain, Italy, Netherlands, Poland, UK and Sweden), as well as the US and Canada.
25 pence out of every pound to be made on mobile
By the end of 2016, mobile devices will be responsible for 25% of retail sales in Europe, compared to 20% in 2015. This is a slower rate of increase than was seen in 2013-2014 or 2014-2015, but reflects the fact that irrespective of browsing behaviour, most online customers at present prefer to place their final order or make a payment using PCs or laptops.
This year, British spending on mobile devices is set to increase almost 36%, to £21.37bn, vs £14.95bn in 2015. The research shows that a much larger share of pre-transaction browsing, comparing prices, and checking stock and delivery options is being done using mobiles. In fact, up to 60% or 70% of searches and web browsing is done via mobile devices. This highlights that mobile is still mainly a discovery tool which shoppers use to collect information, and the final transaction often happens in another channel, offline or online.
RetailMeNot’s research shows that over one third (34.8%) of the UK population have now made a purchase on a mobile device, compared to 20.3% across Europe. It’s the highest share of all markets covered in the survey, followed by Sweden (33.9%), the U.S (31.9%) and Germany (26.8%).
Average spend per head
Across Europe, annual spend per online shopper is expected to rise from an average of £820 in 2015 to £901 in 2016. In the UK alone, online shoppers will spend £1311 each, up 11.7% compared to last year and 15% more than German online shoppers who come in second in Europe with an annual spend of £1142 per shopper
Total online spend is also being largely driven by an increase in spending on mobile devices. This year, British mobile shoppers are expected to spend £907.61 on smartphones and tablets, up from £618.86 in 2015. This is almost double the European average of £554.86 and 16% more than the average annual spend in the US (£781.25).
In addition, British consumers will be spending more this year on individual purchases. Brits’ average online shopping basket is predicted to increase from £55.36 to £60.19, the highest expenditure per transaction seen across Europe. On mobile devices, Brits will spend an average of £47.35 per transaction, compared to £41.62 in Europe and £55.21 in the US.
As shoppers become more confident making purchases on mobile devices, consumers are shopping more frequently. This year, Brits will make 19 purchases on mobile devices, up from just 8 in 2014, putting the UK ahead of both Europe and the US, where shoppers are predicted to make 14 purchases.
Showrooming – blurring the retail lines
Looking forward, instore mobile retailing is set to continue to grow. Using smart-phones instore – or showrooming – has been much commented upon in recent years, with a recent study revealing 40% of British shoppers admitting to have used their mobile phone to browse the Internet for merchandise or to take photos of products they were planning to buy while they were shopping in physical retail stores (Centre for Retail Research 2015). Although showrooming of this kind is intimidating to bricks and mortar stores, the opposite trend of ROPO (research online, purchase offline) is also becoming increasingly common. Consumers are simply ignoring the traditional divisions between offline and online retailing in favour of a low price.
Giulio Montemagno, senior vice president international, RetailMeNot, said: “What this research shows us is that consumers want the most convenient shopping experience possible. Shoppers are growing increasingly confident in shopping online. They are no longer intimidated by making purchases via their mobile phone or tablet, so now in order for retailers to capitalise on this, it is important for them to continue making the shopper experience as trustworthy and as seamless as possible in order to benefit. When it comes to the consumer, it’s all about convenience, and this reinstates the need to prioritise the idea of the omnichannel experience – making it as simple as possible for consumers to access the same deals and experience both on and offline”.