Over 10 years ago when Amazon.com came onto the scene, people starting projecting the end of physical stores and people sitting around in their pajamas with their computer basically taking over all the shopping for them. It was a fun science fiction to think about, but far from the reality of what has happened.
Of course online retail sales have been growing at a fast pace, as many people get used to the idea and develop some trust of the process. Yet some of the projections made will probably never end up being true, like nobody wanting to go to physical stores to do their shopping.
A number of experts are saying that the years of exponential growth are probably over for online shopping, and things will start to slow down.
Most of those using the Internet of online shopping are for the most part already doing it, those not willing to do it probably never will.
The good news is those that are buying online will probably do even more in the years ahead, allocating more of their budget to Internet shopping.
“Pretty much, most of the people who are ever going to be buying online are online,” said Patti Freeman Evans, senior retail analyst with Jupiter Research. “From the standpoint of behavior change and big shifts in adoption, it’s happened and it’s done.”
Jupiter Research believes growth will drop into single-digits sometime around 2010, and will flatten not too long after that.
Even so, Forrester Research shows online retail growth in the U.S. to grow from $132 billion in 2006 to $271 billion in 2011. With physical retail stores also growing, online retail will still remain about 9 percent of all U.S. retail sales.
The most successful retail operations in the future will be those who are able to integrate their online and offline sales the best.
Still, some companies haven't got the basics of online retail down yet, as there is still a lack of product information and detailed pictures and size charts, etc. There's also a problem of keeping information updated on products and availability. Those not getting these basics right will find themselves struggling to compete in the narrowing online retail market.
Another important thing retailers need to consider is many people do their browsing and research online before making a decision to buy. So even if an item isn't purchase online, the decision to buy is made by what is presented on the Web site.
So while overall online retail sales will slow down, those who get the basics right and integrate their physical stores with their online counterparts will outperform those who don't execute as well, maintaining solid growth even though the general online retail market is slowing.
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