Barclays research points to growing impact of ‘mobile’ customers in retail sector

Jane Galvin of Barclays.

Jane Galvin of Barclays. - Credit: Archant

Spending by consumers in the East of England on using smartphones and tablets is expected to reach £2.9billion a year by 2019, according to research by Barclays.

The figure compares with a current spend of £876million and represents an increase of 231%, the second highest in the country after London.

Nationally, spend on smartphones and tablets is expected to grow from £9.7billion to £53.6bn. However, the influence of mobile on spending is expected to more than double this figure from £18.4bn to £112n over the same period, meaning that nearly half (42.4%) of all retail sales will involve a mobile device in some way or another.

Eastern retailers will see spend influenced by mobile devices increase by 164% from £1.9bn to £4.9bn by 2019, again, putting the region second to London.

Jane Galvin, Barclays’ eastern region managing director for corporate banking, said: “The size of the retail opportunity in eastern region is clear for all to see from the predicted growth figures where we are comparing strongly against London.

“The question every retailer should be asking themselves is what they are doing about it to not only satisfy today’s consumer but, also tomorrow’s.”

The number of tablet users has doubled in each of the past two years, with almost half of adults now owning one, while smartphone penetration has rocketed since 2007 following the launch on the first iPhone. In 2009, 14% of consumers owned a smartphone, by 2014 the number had more than quadrupled to 61% and by 2019 around 75% of adults are predicted to own one.

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Nearly half (46%) of retailers claim that at least some of their sales are already generated through a mobile device, although less than 3% believe their business is at the cutting-edge when it comes to being mobile ready and 70% do not currently offer a mobile website or an app for consumers.

When consumers were asked what they most wanted, more than half (57%) suggested that all shops offer free hotspots, with a further 42%saying they are always on the lookout for free Wi-Fi hotspots when out and about.

Retailers claim their reluctance to invest is because they feel that rather than generating new sales, mobile has simply shifted sales around. They are also concerned that mobile adds substantially to the cost of doing business online.

Jane Galvin added: “While it may be premature to sound the death knell for desktops and laptops across our region, nearly half of consumers claim to be shopping far less on these devices thanks to mobile. With new gadgets and gizmos such as the Apple watch being launched all the time, this trend will inevitably gain momentum.

“There is also a lingering notion that mobile shopping is bad for store retailing. The physical high street store still has a fundamental role to play and the development of hybrids such as click and collect has conclusively demonstrated that stores can be supported rather than hindered by the growth of digital commerce.

“Inevitably practices such as ‘showrooming’ leads to some sales shifting online but, with almost three quarters of consumers using their mobile devices whilst out and about, ignoring this trend would be a missed opportunity. Eastern Region retailers must cater for the mobile consumer in order to remain relevant”.