‘Online shopping is no longer exciting. Etailers will need to pedal harder to succeed’

Once upon a time, ecommerce was synonymous with the sexier side of retail.

The turn of the millennium welcomed in a new era for digital retail. In 2000, Asos burst onto the scene with its army of fashion followers. In the same year, Ocado disrupted the grocery market with its seamless platform and impeccable service, and Net a Porter achieved the impossible, creating an elite wealthy club where people spent thousands on clothes without even trying them on.

Shortly after, in 2004, Matt Moulding set up the The Hut Group selling CDs and DVDs online, and enjoyed rapid growth and diversification up until its float in 2020. The pureplays were the darlings of the City.

Fast forward to today, many of these darlings have lost their looks. Asos, THG, Very, Net a Porter, Boohoo among them. Many more have withered away – Made.com, Matches, Farfetch, Wiggle, the list goes on.

Of course, some ecomm giants continue to dominate and steal market share – Amazon, Shein, Temu. But ecommerce sales in the main are limping along. Last Christmas, year-on-year sales growth in stores outstripped that of online. In October 2024, the IMRG online retail index reported the first year-on-year ecommerce growth since April 2021 (of 3.2% for September).

Has the role that online shopping plays in people’s lives changed for good? Because, to put it bluntly, it’s no longer exciting. It’s convenient, it’s easy (until you factor in the inevitable hit and miss of deliveries), and it’s the ideal channel if you want to roam around online seeking out the lowest price. But it’s not interesting. Even the growth of Vinted and Depop can ultimately be attributed in part to price, as well as to an extent circularity. People shop there to make money or afford products that may be unattainable if bought new.

“Your product and price is all too exposed at the tap of a keyboard”

This plays out in the piece Retail Week published this week on those retailers that can afford to raise their prices and those which cannot. Those that can include Primark, Ikea and Dunelm. Those that cannot include Shein, Very and Wayfair. Is it a coincidence that many of those which can’t are the online players?

Online is the go-to for bargain hunting. These are shoppers who think with their heads, not their hearts. There is no enticing store design, perfect visual merchandising, persuasive store colleagues, no experiential side of retail to lure people in and persuade them to part with their cash. Your product and price is all too exposed at the tap of a keyboard.

You’ve either got to have the very best level of convenience in the world (Amazon), unrivalled price and range (Shein and Temu) or a powerhouse of a brand (this is where I struggle to think of a pureplay example) to be able to command true customer loyalty and an indomitable presence online alone.

That is why we’re seeing so many online retailers venture into brick-and-mortar. Online is the perfect means to launch a brand. It’s the ultimate testing ground. But supercharging growth becomes difficult once you’ve determined that your product and proposition is indeed a goer.

“Stores are the place where shoppers seek inspiration, where they feel a connection with a brand. It’s the place where a retailer can shout loudly and truly stand for something”

Put simply, shoppers like shops. Not necessarily to buy – they might then go and buy online on their phone – most people’s treasured possession. But stores are the place where shoppers seek inspiration, where they feel a connection with a brand. It’s the place where a retailer can shout loudly and truly stand for something.

The customer journey and path to purchase is now extremely complex. Accenture Song’s Sarah Lambert talks this week about discovery commerce, with content at its heart. “It’s changing the game for online shopping, with creator and seller shoppable videos offering an in-depth, interactive and experiential view of a product online – similar to an in-store sales demonstration, but with the added bonus of being in the comfort of your own home.”

Nearly every retailer needs an online presence of some description, but what that looks like is evolving. Lambert points to the growth of TikTok Shop – Lidl sold out of its 3,000 high-protein bundles in 18 minutes.

Is social the only place where online shopping is now interesting? Will the humble website always play a role in retail? Who knows. It’s somewhat comforting to observe the unwavering consumer support for the physical store – retail’s original channel. But one thing is clear; and the world of ecommerce has got to pedal a lot harder now as newness is no longer its thing.