Yes, sales are being squeezed, consumers are hesitant about spending and everything seems glum. However, the internet is proving to be a good hunting ground for increased sales across most of the durable markets.
For the total IT market, although sales were down 4.8 per cent in April 2009 compared to April 2008, the internet portion saw a solid eight per cent growth over the same time period.
As consumers are looking to cut costs they are becoming much more savvy at utilising all mediums to find the best deal for the goods that they want. The internet now comprises 25 per cent of the value in the total IT market, and represents a key tool for them to save a few pennies in an otherwise challenging time.
With key growth of the internet distribution channel in the total durable goods market currently coming through mobile computers and non-game box software, the IT market is one sector pushing the internet as an opportunity to reach consumers.
In particular, media gateways and storage are the two IT categories benefitting the most from the internet. As of April 2009, 43 per cent of all storage sales are now being made online as the consumer looks to capitalise on key deals for external HDD. Media gateways stand out, with almost 84 per cent of sales being made via the web.
This is incredibly interesting given that this product is still in its infancy. Furthermore, with early adopters and tech-hungry consumers out there looking to increase the quality and the speed of their home networks, this area could yet see a much greater expansion of sales.
If we look towards the internet growth in the latest month, mobile computers continue to drive forward. Within this, web sales of netbooks increased by over 500 per cent in April 2009 compared to the same period last year. The online growth is currently now outstripping that seen for netbooks within the traditional physical retail environment.
For non-game box software the market is also seeing growth at two per cent – with new products due onto the market, sales of older software packages are experiencing revival.
So what can be said about the internet as a tool for sales? I believe it’s clear that the internet has been playing a greater role for manufacturers and retailers alike to improve their sales for some time.
Right now, where the High Street is suffering, internet sales are going well. The ‘bargain-hunting’ consumer of the recession is finding the internet a key tool to find and purchase products. And finally, it’s a mark of the IT sector’s sophistication that the consumer is using this tool to make important home computing decisions.