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News - 17 November 2007

High Street retailers take the lead online

High Street retailers have finally got their act together online to compete with pure-play online competitors. And over the last few months they have moved into the lead.

Hitwise, a leading online competitive intelligence service, has produced evidence to show that high street retailers received over half of all UK Internet visits to online retailers during October (based on two Hitwise custom categories consisting of the top 50 high street and non-high street online retailers in the UK, excluding online auctions and ticket retailers). 51.1% of visits were to an online retailer that also has an offline presence, such as Argos, Marks & Spencer and Next, while 48.9% were to a retailer without a high street presence, such as Amazon, Dell and ASOS.

This is an interesting turn of events and could have some basis in the fact that the high street presence offers a security that nebulous virtual companies can only offer when they are very well established for example like Amazon.

“Traditionally high street retailers receive less online traffic than their pure play online competitors, except during the Christmas and January sales period,” commented Robin Goad, Research Director for Hitwise UK. “In 2006 high street retailers only overtook their online rivals during the peak month of December, but this year they overtook in September and have been widening the gap ever since. It looks like this year will be a bumper Christmas online for traditional bricks and mortar brands.”

Search engines are the largest source of traffic to both High Street and pure-play retailers online. However, High Street retailers were more successful at gaining traffic from search engines during October, with Search Engines accounting for 37.1% of their upstream traffic compared with 30.4% for the for pure-play online retailers.

Email marketing is also an important source of traffic for retailers in the run up to Christmas, with one in 20 visits to a Shopping and Classifieds website coming from web-based email site in October. Analysis from CheetahMail, Experian’s email marketing and web site analytics company, reveals that UK consumers in October spent an average of £85.00 online in response to permissions-based email offers from apparel retailers.

Traditional retailers using email marketing to capitalise in the run up to Christmas is a shrewd move, according to Steve Lomax, CheetahMail’s European Managing Director: “As we get closer to Christmas, we’ll see email marketing accelerate as traditional retailers use it as a major sales tool to advertise ‘last minute’ online-only promotions, but also to drive footfall for specific in-store offers. It’s a case of them making sure they get the best of both worlds.”

The Apparel and Accessories sector has seen the largest online growth of the 19 Hitwise retail sub-sectors, increasing its share of online Shopping and Classifieds visits from 6.6% to 8.4% over the last 12 months. The sector now accounts for one in every 12 Internet visits to the retail sector. The top three Apparel and Accessories retail websites in October were, and, while ‘next’, ‘asos’ and ‘topshop’ were also the three most searched for terms sending traffic to the sector.

In October, continued to lead the Apparel and Accessories category, receiving twice the market share of visits and two and a half times as many brand searches its nearest rival, However both & third placed have seen a steady growth in visits over the last year. Both sites index highly with females aged 18-24 and capture a higher proportion of traffic from the North West region and London than Next.

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