It is undeniable that the online developments are playing a major role in the future scenarios that have been outlined. What have those developments been and what are the future prospects?
Weltevreden (2012) identified four phases in the evolution of online shopping. In the first phase, between 1994 and 1999 only 16% of people in the Netherlands had access to the Internet from home. In this period, the vast majority of the activities consisted of surfing the net and using e-mail. Retail chains and mail order firms in particular had a website, although only 4% also used the website as a sales channel. The website during this period was mainly used as a referral to the store (opening times, location). There is virtually no online shopping: in 1998, only 2% of the Dutch population bought via the Internet. By 2003, this had already risen to 31% due to a substantial growth in the number of households that became connected to the Internet between 1999 and 2003: around 68%, of which one-third was already using a broadband connection. By this time, an increasing number of retail chains and independent retailers now have a website, which is used for providing more information about products and services and for e-mailing newsletters to keep customers informed and to build loyalty.
In the period between 2004 and 2009 the number of households with access to the Internet had increased even further to 91% and webshops and social media are becoming popular. By 2009 more than two-thirds of the Dutch population were shopping online, and the amount of spending online and the average amount spent was increasing substantially. This period showed the mass emergence of the (smaller) web-only firms, which resulted in a threefold increase in online sales. However, the traditional retail sector lagged behind when it came to developing webshops: only 18% of the retail chains and only 6% of the independent retailers had a webshop in 2006.
In the final phase, between 2009 and 2012, virtually every Dutch person is connected to the Internet, where a shift can be detected towards the use of the laptop and the Smartphone as the device for this, rather than the desktop. In 2012 three-quarters of the Dutch population shopped online and although the number of orders placed and the amount of the spending were still increasing, the rate of growth was levelling off. The number of webshops operated by retail chains and independent retailers was increasing, however, retailers with a physical store still remained in the majority (61% in 2011) compared to 17% web-only firms in the retail sector. By 2011 around 22% of retailers had both a physical store and a webshop.
Weltevreden (2012) concludes that the impact of online sales on physical shops was substantial, in addition to factors such as the economic crisis, increased rents for physical stores, opening time legislation and suchlike: “In sectors in which (parts of) the product or the service can be digitised, such as financial products (digital policies), holidays and travel (e-tickets), photograph/film (digital photographs) and media goods (music, films), the number of stores has declined considerably in the last decade. Telecom is the only exception; in this sector the number of stores has increased substantially, which is in part due to the growth in demand for mobile Internet devices.” (2012, p. 20). Conversely, it applies that “Especially in (…) sectors that are interesting for recreational shopping, such as clothing, shoes, personal care and sports products, there is an increase in the number of stores ” (p. 20).
We can carry through the historical development outlined by Weltevreden to the present day and to the future and can do so on the basis of the results of the Shopping2020 research programme. This research programme asked the question how the consumer would be shopping in 2020. This question has become relevant and urgent in the context of the crisis and developments such as changing consumer behaviour, changes in the value chain, the emergence of new technology, the digitising of products and profound (international) competition.
From the Shopping2020 study it appears that in 2012, of the total consumer spending 17% was online, and 83% was in the physical stores. This spending represents an online turnover of 11 billion euro out of a total of 65.9 billion euro. The product categories that have the largest share in this are insurances, travel and ticket sales (flight ticket, accommodation). Of the 11 billion euro of online sales, 4.8 billion euro is for the retail sector. Fifty per cent of that 4.8 billion euro is shared between 10 sellers: RFS Holding (Wehkamp, Fonq, Create2fit), Bol, Zalando, Albert.nl, BAS group (Dixons, MyCom, Dynabyte), Coolblue, KPN, H&M, Hema and Ticketmaster Nederland. If you look at fashion retail then, it represents approximately 10% of total online sales: 0.9 billion euro for clothing and 0.3 billion euro for shoes and personal lifestyle (Shopping2020, 2013; Wolters, 2013; Schut et al., 2014).
It is expected that the online share will increase substantially over the coming years. The forecast growth up to 2020 does however depend on who one asks. According to consumers the online share shall increase from 17% to 50% but according to experts the share shall increase to 36% (Wolters, 2013). The expectations differ considerably for each product category. The biggest growth is expected in the product categories that were already doing well online in 2012: event tickets, package holidays, individual flight tickets and accommodation and insurance are expected to increase from the current 50% to 70% and 80% of the share of online sales. For fashion, according to the experts, the current share of 10% of online sales will increase to 27% for both clothing and shoes & personal lifestyle (Wolters, 2013). The ING report about shopping domains also comes up with the same estimate (Erich, 2014). The same pattern, but with different figures, can be seen when consumers are asked about the products that they will no longer be buying in a physical store come 2020. The top of that particular list contains the same product categories stated by the experts: event tickets, package holidays, individual flight tickets and accommodation and insurance. Around 40% of the consumers say that they will no longer be going to the physical store for these products. For fashion the number is considerably less: 17% (shoes and personal lifestyle) and 12% (clothing) (Peters & Witte, 2013). We shall return to the potential reasons for this when we discuss the role of the physical store.
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Erich, M. 2014. Winkelgebied 2025. Samen in beweging. ING.
Peters, S. & E. Witte. 2013. De consument in 2020. Ede: GfK.
Schut, G., Josten, L., Beek, A., Heinemans, L., Selimi, S. & B. Jansen. 2014. Consument organiseert in 2020 zijn eigen gemak. Postnl/Capgemini Consulting. Download van www.shopping2020.nl
Shopping2020. 2013. Shopping 2020 synthese – de e-ambitie voor nederland. Download van www.shopping2020.nl
Weltevreden, J. 2012. De evolutie van online winkelen in Nederland. Amsterdam: Hogeschool van Amsterdam.
Wolters, M. 2013. Hoe shopt uw klant in 2020? GfK expertonderzoek shopping 2020. GfK.