Overview
At present there is relatively little publicly available data about home shopping and delivery. Public and private data that is currently collected is often not compatible in terms of the units of measure used (for example, different organisations measure deliveries in tonnes, number of items delivered, and number of delivery addresses, making data comparison and synthesis impossible).
The type of data most required to achieve a better understanding of home deliveries is likely to include:
- consumer preference data about issues such as the types of home delivery systems that are most favoured, the most preferred delivery times and days, and the amount that customers are prepared to pay for different levels of home delivery customer service;
- operating cost data for different home delivery options and systems;
- growth forecasts for the home delivery of different categories of product;
- trip generation data for home deliveries and effects on passenger transport of home shopping and delivery;
- environmental impact data concerning the effects of different home delivery options, and information about the comparative environmental impact of traditional shopping versus home shopping and delivery.
Consideration also needs to be given as to how best to collect the necessary data. Publicly available data of this type would help to facilitate better evaluation and decision-making with respect to home deliveries by companies and policy makers.
To determine which data needs to be collected in order to improve understanding, operational efficiency and policy considerations about home delivery. Consideration should also be given to data collection methods.
Funding
Results
Published figures estimate that in 2000 the market size of the UK home shopping sector was £16.3 billion and was expected to grow by 115% between 2000 and 2005. Both traditional catalogue/mail order and online sales are included in this estimate. The experts interviewed by the project team agreed with both these average predictions. Experts involved in supplying goods to the market were more optimistic about growth in the overall home shopping sector than those delivering the goods.
All experts believed that significant growth in the market would continue until 2005, due to increased mail order and marketing activity and an increase in online sales. After 2005 most expected the market to near saturation point. They predicted a more limited growth in online sales up to 2010 of 79% as a result of a slow down in the number of consumers with high levels of disposable income connecting to the Internet. However, experts from the grocery home delivery sector estimated that the entire home shopping market would grow by 175% between 2005 and 2010.
The project team also identified several reports that described the past, current and future size of the UK online shopping market. An average estimate from these reports is that this market was worth £6.1 billion in 2001. Many experts felt that these figures were too high and estimated that a market size of £4.9 billion was more realistic. They also forecast that the online market would continue to grow significantly in the future. Overall, the experts predicted a 124% growth between 2000 and 2005. This is higher than the equivalent published forecasts from market research companies of 105%. Again, experts predicted that growth in online sales would slow slightly between 2005 and 2010 to 104%. Based on current figures, these growth estimates correspond to an online market worth approximately £11 billion in 2005 and £22.5 billion in 2010. Online sales would then represent approximately 4.3 and 7.7% of retail (food and non-food) spending in 2005 and 2010, respectively.
Policy implications
In terms of data requirements, all the experts interviewed felt that information about market structure and trends in the home shopping sector was currently limited. They commented that this type of market trend data (if it were available) would be useful for planning purposes and also to benchmark their own organisation's performance. Experts from the private sector also expressed an interest in having more information about delivery costs and delivery options. Suppliers and experts from the grocery sector were concerned about the lack of data about consumer needs and service requirements. These were unsurprisingly focused on consumer purchasing habits, service expectations and requirements.