Looking back through Internet Retailing's news coverage during the first few weeks after I joined in July 2008, it becomes very quickly apparent that many of the issues that online retailers are grappling with today have been on the horizon now for nearly two years.
That first month, IMRG published figures showing that online retailing had increased by 38% in the first six months of 2008 when compared to the same period in 2007 and predicted that, with online accounting for 17% of all retail sales, the industry had now reached a tipping point.
The same month, however, it became clear that the credit crunch had begun to bite for the first time as the Office for National Statistics reported the biggest drop in retail sales for 22 years.
With online continuing to surge ahead while the high street faltered, IMRG was proved right in its prediction that internet retailing had reached a tipping point. For the first time, the main boards at major retailers began to take the online divisions seriously and it became clear that the internet was to be the place to invest in the year ahead.
The first signs of a number of trends that have become key elements of internet retailing over the last eighteen months were also appearing that summer as:
- Customer ratings and reviews, viewed with suspicion by many retailers in the beginning, were now succeeding in proving themselves with retailers such as Wickes giving them the green light after conducting successful small-scale trails.
- Websites dedicated to providing credit crunch-hit consumers with information on the latest discounts and coupons became the fastest growing sites on the internet.
- With the launch of an online customer community, New Look became one of the first retailers to recognise the advantages of using its website to generate real-time customer feedback.
- The first steps towards the use of mobile marketing in retailing were being taken, with the launch of Marks & Spencer's first mobile campaign promoting its Back to School range.
- Multi-channel retailers were beginning to pull ahead of pure plays for the first time with Hitwise reporting that the internet properties of the UK's top 100 high street retailers received 19.3% more visits during July 2008 than the 100 largest online-only retailers
- Asda signalled a move towards the recognition that the internet has not replaced the need for catalogues, putting three million Asda Direct catalogues into circulation.
- Video was becoming an emerging trend, with Oli experimenting with the first 'click to buy' fashion videos.
- Argos celebrated its 35th birthday with the news that it was now generating £500m annually in sales from its Check & Reserve service and that the internet overall accounted for 21% of its £4.3bn annual sales.
What does the next couple of years hold in store? I'll be reporting back on Friday with a look to the future of internet retailing, focusing in particular on the mobile arena.