eCommerce - Growing Very Fast, Still a Long Way To Grow

eCommerce in the UK shows no sign of slowing.

The IMRG Capgemini e-Retail Sales Index March 2014 shows

the UK online retail sector has experienced its strongest Q1 growth in three years, representing an estimated £23.1 bn spent online.

Q1 2014 sales were up 17% on Q1 2013 (the strongest Q1 growth since 2011).

At Forward Partners we invest in early stage eCommerce startups.

Why do I think that eCommerce will continue to perform?

  • Increasing smart phone and tablet penetration and usage will increase consumer market size
  • Better connectivity (4G, more wifi) will increase potential shopping time
  • Simpler user interfaces on mobile apps create less friction and will drive up conversion
  • Improved delivery networks will improve convenience for consumers (and therefore conversion)
  • Mass personalisation at scale thanks to contextual data and on demand roduction will drive relevancy
  • New marketplaces will come online for the first time as previously low tech local businesses take advantage of mobile technology
  • Brands can now invest in eCommerce at a lower cost than ever before thanks to tech platforms like Magneto, Amazon web services



We're not alone in believing in the eCommerce sector.

Mark Andreessen (@pmarca) when interviewed earlier this year by Sarah Lacy in Pandodaily took a bullish view of the future of eCommerce;

“Retail guys are going to go out of business and ecommerce will become the place everyone buys. You are not going to have a choice,” he says. “We’re still pre-death of retail, and we’re already seeing a huge wave of growth. The best in class are going to get better and better. We view this as a long term opportunity.”

Increasingly retail will, category by category, become desktop web enabled, then dominant online, then quickly optimised for mobile web.

Over time mobile web will dominate.

Physical stores will continue to exist but will need to re-invent themselves to continue to be relevant.

We're still in the very early stages of the eCommerce revolution.

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