London, 21 April 2009 - Hitwise, the leading online competitive intelligence service and an Experian company, today revealed that UK Internet users are spending less of their online time shopping and more time browsing online media. During March 2009, 8.6% of all UK Internet visits went to online retail websites and 9.8% to social networking websites. A year ago, in March 2008, the figures were reversed: online retailers accounted for 9.7% of all UK Internet visits, and social networks 8.2%. Over the same time period, the share of UK Internet visits attributed to Entertainment websites (11.4% in March 2008, 11.6% in March 2009) and News and Media websites (5.0% in March 2008, 5.6% in March 2009) has also increased.
"The growth of social networking, online video and the continuing popularity of news websites has meant that an increasing proportion of consumer's online time in the UK has been devoted to online media," commented Robin Goad, Hitwise's Director of Research. "Historically this has gone hand in hand with the growth of online retail, but over the last 3 months online retailers seem to be really suffering from the economic downturn for the first time. Traffic to online retailers always peaks over the Christmas period, then declines during January and February, but picks up in March. Last year UK Internet traffic to online retailers increased by 0.8% between February and March, but this year it fell by 0.1%. The decline between December and February was also greater this year."
Electronics retailers and department stores have experienced the most significant declines in traffic since Christmas, although the recent Spring sales acted as a temporary boost for the latter category. Sales related searches increased by 75% between the weeks ending 21 and 28 March, and traffic to the websites of the most popular high street department stores increased by 21% over the same period. Debenhams was the biggest beneficiary, with a 40.2% increase in traffic, followed by Marks and Spencer (30.7%) and Littlewoods (18.7%).
"Despite the post-Christmas decline in online retail, there are a number of categories that continue to outperform the general market," commented Goad. "Online fashion was the fastest growing online retail category during 2009 and continues to perform well, despite growth slowing. Sports retailers are also doing well, helped in part by the demand for the new England football kit. The good weather over the last few weeks has led to an increase in searches for garden furniture and tools, with a corresponding increase in traffic to House and Garden retailers. Finally, Classifieds websites have seen their UK Internet traffic increase by 15% over the last 12 months as people look to buy and sell second hand goods online."
Paid search rates have declined for online retailers and UK websites in general
The amount of traffic that online retailers receive from paid search - i.e. from sponsored or paid for links on search engines such as Google, Yahoo!, Live and Ask - has fallen over the last 12 months. During March 2009, 8.9% of all UK Internet visits to online retailers came from a paid search listing, down from 10.1% in March 2008.
"Search engines are the primary source of traffic for almost all online retailers, and a typical ecommerce site in the UK receives 2 in every 5 visits from a search engine. However, the proportion of search traffic that comes from paid listings fell from 27.8% in March 2008 to 22.5% in March 2009. Retailers are amongst the biggest users of paid search in the UK, so this has also contributed to an overall decline in paid search rates. In March 2009, 9.4% of all search engine traffic in the UK was from paid listings, down from 12.1% in March 2008."
Significant increase in the amount of traffic that online retailers receive from social networks
The proportion of traffic that online retailers receive from social networking websites - such as Facebook, Twitter, MySpace and YouTube - increased from 5.2% in March 2008 to 7.1% in March 2009. A year ago online retailers received a similar amount of traffic from both social networks and webmail services (such as Hotmail, Yahoo! Mail and GoogleMail), but social networks now account for 58.3% more traffic than webmail providers. The retail categories that received most traffic from social networks during March 2009 were Auctions, Fashion and Department Stores. Together they accounted for over half of all downstream visits from social networks to an online retailer.
Top 10 online retail websites receiving traffic from social networks, March 2009:
1. eBay UK (www.ebay.co.uk, 1.94% of all downstream visits from social networks)
2. Amazon UK (www.amazon.co.uk, 0.40%)
3. Play.com (www.play.com, 0.19%)
4. ASOS (www.asos.com, 0.13%)
5. eBay (www.ebay.com, 0.10%)
6. Argos (www.argos.co.uk, 0.09%)
7. Gumtree.com (www.gumtree.com, 0.09%)
8. Amazon.com (www.amazon.com, 0.08%)
9. TopShop.com (www.topshop.co.uk, 0.08%)
10. HotUKDeals (www.hotukdeals.com, 0.08%)
"Social networks are a relatively small but fast growing source of traffic for online retailers," commented Goad. "At present, only a minority of retailers pick up a significant amount of traffic from social networks, but many of those that do have seen a positive impact on traffic. For example, fashion retailer ASOS has a strong presence on Facebook and in March received 13.3% of its traffic from the social network. Another example - in a very different market - is online bookseller Abebooks, which currently receives a quarter of all its UK Internet traffic from social networks, more than it gets from search engines. These and other examples illustrate that a retailer's success on a social network has less to do with products or demographics than it does with effectively engaging with an online community."
About Hitwise:
Hitwise is the leading online competitive intelligence service. Only Hitwise provides its 1,500 clients around the world with daily insights on how their customers interact with a broad range of competitive websites, and how their competitors use different tactics to attract online customers.
Since 1997, Hitwise has pioneered a unique, network-based approach to Internet measurement. Through relationships with ISPs around the world, Hitwise's patented methodology anonymously captures the online usage, search and conversion behaviour of 25 million Internet users. This unprecedented volume of Internet usage data is seamlessly integrated into an easy to use, web-based service, designed to help marketers better plan, implement and report on a range of online marketing programs.
Hitwise, a subsidiary of Experian (FTS: EXPN) www.experiangroup.com operates in the United States, United Kingdom, Australia, New Zealand, Hong Kong and Singapore. More information about Hitwise is available at www.hitwise.com.
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