South Africans spent more than R2 billion online last year, according to research by World Wide Worx.
The company says local online retail has “entered a phase of sustained acceleration”. World Wide Worx's Online Retail in SA 2011 study shows total local spend on online retail goods breached R2 billion for the first time last year, growing 30% year-on-year.
Online retailers are bullish about 2011, with the industry consensus pointing to 40% growth this year, according to a statement issued by World Wide Worx. Sales in 2011 are expected to show the highest rate of growth for online retail in SA in almost a decade.
“This dramatic rise in online retail comes in the wake of an ongoing increase in the number of experienced Internet users in SA,” says World Wide Worx MD Arthur Goldstuck. There are about five million South Africans online.
“Last year, there were 3.6 million people who had been online for five years or more. By 2015, that figure will be 6.8 million - almost double the potential e-commerce market of today.”
In 2010, traditional, physical retail in SA reached R561 billion, according to Statistics SA. Online retail still makes up less than half a percent of total retail in SA: a mere 0.36%. At the same time, the growth rate of online retail in SA in 2010 was four times that of physical retail: 30% against 7%, says World Wide Worx.
Internationally, according to global online retail data analysed in the report, growth slowed in most regions during the global financial crisis, but did not turn negative: total sales never fell anywhere in the world. Industry estimates for the total value of global online retail in 2010 come to an average of about $545 billion. The figure for 2009 was $469 billion.
This indicates that, globally as in SA, online retail is recession-proof for now, while it still makes up a small proportion of total retail worldwide.
“This shows us that online retail growth represents not a rise in shopping activity, but rather a shift in shopping activity, from the physical space to the online space,” says Goldstuck.
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