Fashion to lead the way for 35 percent boost in UK etail

Good news for online fashion retailers like Asos - apparel, and footwear are set to become the biggest contributors to growth within the sector. The UK etail market is predicted to grow 35 percent over the next five years, reaching 68.8 billion pounds by 2022, according to GlobalData.

However, it's not just clothing and footwear that will help drive this surge in online retail, as sectors such as beauty and health will also see a significant rise during the next five years, according to the retail analytics firm. Over the next five years, shopping via smartphone is set to remain consumers preferred shopping channel of choice, as mobile spend is predicted to increase 112 percent. This focus on mobile shopping will be spearheaded by ongoing improvement in mobile shopping, paired with UK consumers need to instant gratification.

78 percent of the population in the UK has shopped online over the last year, as the channel offers shoppers a sense of convenience as well as the lure of lower prices. Young shoppers, in particular, are shopping more and more online in the UK. “Our E-retail report shows online shopper penetration for 16-34-year-olds above 90 percent affirming the importance of the online channel for younger consumers,” said Sofie Willmott, Senior Retail Analyst at GlobalData. “Online pureplayers including Amazon and Asos continue to innovate introducing new technology and driving up consumer expectations of delivery and user experience, requiring multi-channel players to quickly follow suit to maintain their relevance.”

However, online returns are also predicted to grow at nearly the same rate as online spend over the next five years, raising concerns with return management and delivery costs. Clothing and footwear are forecast to account for 70 percent of all online returns in the UK by 2022, as online pure players continue to struggle to solve issues with sizing and fit. “Despite the online channel providing a lifeline to bricks & clicks retailers experiencing tough offline sales, e-retail still imposes significant challenges, including the management of returned stock,” adds Willmott.

“Online returns will continue to rise over the next five years as consumers become more experienced and confident in managing the free and simple returns processes, combined with increased availability of online delivery saver schemes.”

Photo: Asos, screenshot