An opportunity for you?

OK, so explosion might be a bit strong, but these figures show enormous growth in online shopping :

1 - John Lewis's Department store sales have grown by more than 50% in the last year

2 - Ocado sales were up 60% in the final week of 2006 before Christmas

(For the full story click here)

John Lewis also announced an increase in sales of 11%, so you would expect growth in online sales, but the scale of this growth is surprising.

This change in the balance of online shopping (or ecommerce) in one of Britain's long-established, traditional and customer focused retailers must reflect a more general trend. Certainly John Lewis is targeting the more affluent end of the market which you would expect to be online and increasinly in broadband. But you could also argue that the profile of their customers (I think of my father here!) would make them less prone to shop online.

So what does this mean for smaller businesses. As with most change, ecommerce offers both opportunity and threat. Increasingly retailers need to use both the on and offline channels to reach their market, so as to be able to hold on to their market share. So for anyone who is not yet trading online, this is yet another wake-up call.

More interesting though, I think that the increase in online shopping creates a new opportunity for those in the supply chain who have not, as a matter of course, looked to sell to consumers directly. The internet offers a cost-effective means of creating a complete channel to market. From marketing to fulfilment, there are numerous solutions available which allow you to test or establish a direct channel without deep pockets or high levels of risk. Much of the input required can be leverage out of existing resources and the profit margins avialable, particularly to those who control the whole supply chain from production to consumer, are very tempting.

I'm not saying that it will work for everyone, but everyone should certainly be aware of the situation, not least because if it isn't an opportunity it's likely to be a threat.