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These consumers are from all age ranges and backgrounds and their thirst for value means they are shopping in a fickle manner, using the power of web search to constantly track value from retailers.

But the great danger for the High Street is that, once this wider set of consumers sees the web as the best source of a bargain they will continue to shop this way, even when the downturn ends.

And that is before the lower carbon footprint of home shopping is taken into account.

Dramatic signs of this consumer shift include:

• Up to 90 per cent of the growth in fashion retail-related traffic on internet search engines has been driven by value searches, whether that be discount codes, vouchers or just plain bargain-hunting.

• 89 per cent of grocery shoppers now expect offers as a standard part of their shopping experience

• Debenhams has just launched Outlet, an all-year round clearance store on their site as a result of this change in consumer behaviour.

The fact that many of these customers are now choosing to close the deal online for their clothing items, both branded and unbranded, after finding what they want at the right price, is great news for both discount retailers and those retailers providing great value.

But once online shopping has made it easier for customers to become even more price sensitive, it is highly unlikely that they will go back to their previous shopping habits when they have more money in their pockets again.

The stark conclusion of a KPMG/Retail Think Tank debate last year was “that the current retail culture of constant discounting, sales and promotions is unsustainable and likely to lead to increasing numbers of insolvencies. Retail in the UK is at a turning point and requires a new set of strategies to survive.

UK retail sales fell in March compared with a year earlier, the British Retail Consortium (BRC) has said.

Like-for-like sales, which do not include sales from new shops, fell 1.2% – the ninth fall in sales in the past 10 months.

The BRC said continued economic uncertainty was leading consumers to tighten their belts.

I can foresee a time when fashion shoppers will rely on price comparison websites to drive them to the best price, putting those retailers not featured on these sites at a serious disadvantage

So how on earth can the High Street compete? The answer is in continuing to improve value and the consumer shopping experience.

The provision of high quality in-store restaurants, adjoining leisure facilities, such as cinemas and bowling alleys, street entertainment and in-store experience creates a feeling of theatre around the whole shopping experience.

However, online, there are similar opportunities to keep stepping forward, utilizing the interactivity of web 2.0 and on to the rich personalisation features anticipated in web 3.0.

There are still many multi-channel store and online retail experiences that are very different (or even non-existent) and not in any way seamless for the customer. The rise of the bargain hunter may be the catalyst to some retailers taking online and multi-channel much more seriously.

Steve Goodheart is a partner with online retail analysts Transaction Partnership www.transactionpartnership.com .He helped Littlewoods go online in 1999 and has been involved in the launch of 15 retail websites, which now deliver annual net sales exceeding £1 billion. Their clients include O’Neill Europe, Matalan, Pets at Home and TJ Hughes.

Published: 09 January 2009 00:08 

Web discounts have grabbed customer attention over Christmas but exploiting the online world to its fullest could prove make or break in this tough economic climate. Joanna Perry reports. 

The likelihood of falling store sales in 2009 might make the online doubters think again. Even Matalan – which, along with other value fashion retailers, had shied away from e-commerce – is now experimenting with the channel.

Online expert Transaction Partnership was formed a year ago by ex-Littlewoods executives Steve Goodheart and Richard Blanchard, who helped the company pioneer online sales in 1999. They estimate that a typical mid-sized retail chain could expect 100,000 hits a week on a non-transactional site, equating to £4 million in sales across a year or £1 million alone during the Christmas period.

The battle for the hearts and minds of cash-strapped consumers will get bloody this year; it will also undoubtedly be fought most fiercely online.

“Competitive pricing is a given. Ease of use has to be the key thing. Get that right and the response will hopefully be there”

The UK was the largest online retail market in Europe in 2007, with 27 million online shoppers spending more than €700 each online during the Christmas shopping season.  Source: Forrester