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The expansion of the online retail market is evident again this week as figures for 2005 were released. UK consumers bought ?8.2bn ($14.3bn) of goods from websites last year ? a 28.9% increase in internet marketing over 2004, according to market analysts Verdict. In cash terms that means shoppers spent an extra ?1.8bn online in 2005.

Verdict says the figures show internet shopping is closing in on the ?9.4bn spent in department stores in 2005. Its retail analyst, Nick Gladding, said online shopping was now a “formidable competitor” to the High Street as it allowed people to do the work from home, searching the web for the best value and service.

A quarter of all UK buyers now shop on the internet, for goods and services, as the online shopping community grew by 25.5% to 14.6 million people between 2004 and 2005. The surge in “e-retail” means online shopping is now winning its biggest-ever slice of the UK retail market. Overall UK retail sales grew by just 1.5% in 2005 – the slowest rate since the early 1960s.

In its e-market 2006 report Verdict says internet marketing enables customers to shop at times to suit them. With many more people working from home, the pattern of high street shopping has changed. One of the biggest growth sectors in online shopping is among the over-50s, with numbers almost doubling to 2.7 million users between 2004 and 2005. The amount spent by this sector rose 46.7% to an average ?458 per head.

The report comes a month after a report from e-commerce trade body IMRG said online shopping among UK consumers soared almost 50% in the 10 weeks before Christmas. Shoppers spent ?4.98bn online during the period, compared with ?3.3bn for the same time a year earlier.

Online shoppers need great customer service as they can easily click on to another retailer who serves them better. To keep these clients, website owners must use the right advertising media and launch regular email marketing campaigns. Online marketers can get unbiased advice from dedicated niche websites. The top home based businesses are giving online shoppers what they need: building a relationship, giving excellent service and following up with their customers. Many offline businesses face huge change to retain the modern consumer against this new competition.