Business owners are looking increasingly worried these days. Almost every conversation turns to the so-called “credit crunch” or to a potential recession. People are worried that a financial crisis is looming for business.
Each day in the newspapers we read about job losses, businesses closing and companies having difficulties in gaining business. Some people reckon this is all media “hype”, but others will tell you that business is in difficulties. Add to all this the increase in fuel costs and you can tell why people are worried.
However, new research from Verdict suggests that traditional retail sales will be falling dramatically over the next four years. Several graphs in their report all show a downward slope – not pretty pictures for anyone who owns shops.
But the graphs for online spending are bucking the trend; they are going up sharply. According to Verdict’s director of consulting, Neil Saunders, interviewed in Revolution magazine, “Internet retailing appears to be laughing in the face of the economic slowdown”.
If your business doesn’t have an online shop, or only has a partial Internet retail system, you could start to lose out as the economy takes a nosedive. The amount of money due to be spent online in 2008 is around £20bn; in 2012 it will be £44.5bn. That’s roughly a 25% increase in money going through online shops every year for the next four years.
It seems that if you are worried about the current state of the world economy, the answer for your business is to set up shop online.
But why are people switching to online shopping? Convenience has always been cited as a reason, but it may have more to do with costs. With high fuel prices it now costs much more to visit the bricks and mortar stores; staying at home and shopping from home is much kinder to the family budget. Add to this the growing worries about global warming and you have a powerful combination for many more people to shop online.
The world’s financial crisis and the fears over global warming, combined with the increasing social nature of the Internet could be heralding one of the most significant changes in our society for centuries. Shopping is a social activity for many people – they go to the shops and then have a coffee with friends. If those shoppers are staying at home in their droves, they will want to socialise online. And that means not only do you need online shopping on your web site, but it needs connecting with social networking sites or should have its own social networking features. A simple “shopping basket” is not going to suffice if you truly want to escape the financial meltdown.
Graham Jones is an Internet Psychologist who studies the way people use the online world, in particular how people engage with businesses. He uses this knowledge to help companies improve their online connections to their customers and potential customers and offers consultancy, workshops, masterclasses and webinars. He also speaks regularly at conferences and business events. Graham is an award-winning writer and the author of 32 books, several of which are about various aspects of the Internet. For more information connect with me on Google+