Online retail challenges traditional retailers

Online retailers are gaining ground and are catching up to department stores. Richard Hyman, chairman of Verdict Research, the leading retail consultancy, told Cantos, the online PR service, that figures show that online shopping is now almost equal in value to that of department store sales. He also said that traditional department stores will have to adapt to the new retail environment. Online retail grew approximately 30 percent last year, according to Verdict. The company believes that growth will slow but continue as more people acquire high-speed internet connections and make increasingly more internet purchases.

Hyman pointed out that online spending did not signify a new source of income for retailers. He said that the "key thing about online shopping is that the majority of sales made online are sales that would have been made in mainstream retailing. It's helping to make life far more competitive in the retail sector than it was before because most of the people in the retail sector are now having to add an additional channel...the internet."

Hyman argues that "pure players", whether they be department stores or etailers, have suffered. "I think the truth is that most pure players have not been successful," he said. "Most of them have not made money and an awful lot of them have gone to the wall." The message is clear. To be able to compete in today's market, one needs to offer both physical and online retail capabilities.