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Emerging e-commerce worries retailers

Published 04.08.10   14:22 

Online shopping taking a bite out of traditional retailers’ sales Internet shopping has taken off in a big way in Denmark, with many retailers now fearing it will become a serious competitor. Two years ago, internet purchases accounted for some...

Internet shopping has taken off in a big way in Denmark, with many retailers now fearing it will become a serious competitor.

Two years ago, internet purchases accounted for some 7 percent of all retail sales nationally, but already now, one in ten transactions using the national debit card Dankort, takes place in connection with an online sale. It is expected that for 2010, 40 billion kroner worth of goods and services will be sold online.

Sales of train tickets, flight tickets, car rentals, music and picture downloads and minutes for mobile phones continues to make up the bulk of online sales, but the growth of virtual shopping can be traced to increased sales of goods such as clothing and shoes. Physical goods now account for 49 percent of internet sales, Annette Falberg, general manager at the society for distance and internet shopping, FDIH, said. 

She added that 10 percent of internet shoppers buy shoes and clothing online and that traditional retailers are feeling the effects of the increase. Many of them, she said, fear this sales channel will only continue to grow. 

FDIH has evaluated that up to half of retail revenue over the coming five to ten years will take place on the internet. The organisation points to the emergence of a new generation that has grown up with the web at their fingertips, and improved internet shopping technology as reasons for the growth.

Jesper Birkeholm, director of Dansk Detail, which represents the retail trade, said this trend should also be seen as an opportunity for traditional retailers, though, as it is primarily the larger brands which do well online. 

Chief consultant at the Danish Chamber of Commerce, Mette Feifer, said the trend is closely linked to the economic crisis. As consumers have become more aware of pricing, they are finding that the internet is one of the best places to look for bargains. That has given online shopping a serious push, but makes it difficult to determine whether the trend will continue over the coming years.

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The Copenhagen Post