Internet Quarterly - UK - March 2008

Table of Contents

• Introduction
• Definition
• Research methodology
• Abbreviations
• Market in Brief
• Penetration manages slight climb
• Digital divide remains
• Christmas pushes usage levels up
• Digital device usage rises
• Portable music players and Wi-Fi display early adopter profiles -- still
• Christmas makes its presence felt in browsing
• Travel declines but remains top -- but weather unstoppable
• Mixed fortunes for browsing for information
• Actual purchasing strong in certain areas
• Attitudes towards Christmas purchasing improving
• Price-comparison sites' brand evaluation
  • Figure 1: Online product purchasing, by category, 2005-07
• Internet Penetration
• Quarterly highlights
• Penetration manages slight climb
• Over 30 million now online
• Digital divide remains
• Pervasive use may mean penetration levels are higher
• First signs of growth in long-term penetration levels for two years
  • Figure 2: British Internet penetration at home/work/place of study or elsewhere, 2002-08
• Long-term growth shows twitches of life
  • Figure 3: Growth rates, British Internet penetration at home/work/place of study or elsewhere, 2002-08
• Digital divide remains
• Internet Usage Experiences
• Quarterly highlights
• Christmas pushes usage levels up
• Email leads the way
• The Internet saves money
  • Figure 4: Types of activity undertaken on the Internet in the last three months, 2003-08
• Young still the driving force behind downloading music as pressure mounts
• Music industry reaction
  • Figure 5: Usage of Internet for downloading music, by age, 2005-08
• BBC iPlayer helps streaming video
  • Figure 6: Usage of Internet for watching or listening to video or audio, by socio-economic group, 2007-08
• Price-comparison sites showing little growth
  • Figure 7: Usage of Internet to visit price-comparison websites, by socio-economic, 2005-08
• Appeal of social networking sites remains with young -- but may have peaked
  • Figure 8: Usage of Internet to visit community sites/messageboards, by age, 2005-08
• Technology Usage
• Quarterly highlights
• Digital device usage rises
• Portable music players and Wi-Fi display early adopter profiles -- still
• Digital device usage dips
  • Figure 9: Digital device usage, 2007-08
• HD-ready TV grows as Blu-ray makes significant advances
  • Figure 10: Profile of usage of HD-ready TV, by socio-economic group, 2007-08
• Digital radio grows as doubts are voiced
  • Figure 11: Profile of usage of digital radio, by socio-economic group, 2007-08
• Podcasting broadens its appeal across ages
  • Figure 12: Profile of podcasting usage, by age, 2007-08
• Browsing the Internet for Information Purposes
• Quarterly highlights
• Christmas makes its presence felt in browsing
• Travel declines but remains top -- but weather unstoppable
• Clothing shows impressive long-term growth
  • Figure 13: Websites browsed for information purposes in the last three months, 2002-08
• Travel offers opportunities but must be more responsive
  • Figure 14: Travel websites browsed for information purposes in the last three months, by socio-economic group, 2002-08
• Weather of most interest to the well off
  • Figure 15: Weather websites browsed for information purposes in the last three months, by household income, 2002-08
• Entertainment sites broadening appeal across the ages
  • Figure 16: Entertainment websites browsed for information purposes in the last three months, by age, 2002-08
• Clothing sites driven by women and children
  • Figure 17: Clothing websites browsed for information purposes in the last three months, by gender and presence of children in household, 2002-08
• Browsing with the Intention of Buying
• Quarterly highlights
  • Figure 18: Websites browsed for information purposes with a view to possibly buying in the last three months, 2002-08
• Books show traditional correlation with socio-economic group as Amazon attempts to get digital
  • Figure 19: Profile of book websites browsed with the intention of buying in the last three months, by socio-economic group, 2007-08
• Toys and games show seasonal cheer
  • Figure 20: Profile of toys and games websites browsed with the intention of buying in the last three months, by gender and presence of children in household, 2007-08
• Electricals correlate with wealth
  • Figure 21: Profile of electrical websites browsed with the intention of buying in the last three months, by socio-economic group, 2005-08
• Supermarkets heavily dependent on women
  • Figure 22: Profile of supermarket websites browsed with the intention of buying in the last three months, by gender and presence of children in household, 2007-08
• Actual Purchasing on the Internet
• Quarterly highlights
  • Figure 23: Websites actually purchased from in the last three months, 2002-08
• Purchasing recovers as penetration inches ahead
  • Figure 24: Internet penetration and purchasing behaviour in the last three months, 2002-08
• Toys, gifts and media products best at converting intentions to purchases
  • Figure 25: Websites actually purchased from in the last three months, January 2008
• Christmas hampers travel sites' conversion of browsers to buyers
  • Figure 26: Consumer use of travel websites in the last three months, 2002-08
• Entertainment surges ahead in converting browsers
  • Figure 27: Consumer use of entertainment websites in the last three months, 2002-08
• ABs drive increase in online book buying
  • Figure 28: Actual purchasing from book websites in the last three months, by socio-economic group, 2002-08
• Trends in Online Product Purchasing
• Quarterly highlights
• Online on Christmas Day
• Average expenditure on books, music, entertainment and financial services down...
• ...but clothing, computers, groceries, travel and auctions all up
  • Figure 43: Trends in average spend per online buyer in the previous three months -- books, music/DVDs and entertainment tickets, 2002-08
  • Figure 44: Trends in average spend per online buyer in the previous three months -- clothing and footwear, computer hardware and auction, 2002-08
  • Figure 45: Trends in average spend per online buyer in the previous three months -- travel, groceries and financial services products, 2002-08
  • Figure 46: Trends in average spend per online buyer in the previous three months -- all categories, 2002-08
• Christmas Purchasing Experiences
• Quarterly highlights
  • Figure 47: Online experiences of buying Christmas presents and shopping during the January sales, 2005-08
• Branded sites of most importance to the better off
  • Figure 48: Websites used to buy gifts from over the Christmas period, February 2008
  • Figure 49: ' All the Christmas presents I purchased online are from well-known websites and brands that I trust' , by socio-economic group, 2005-08
• DEs only category to have bought less online this year than last
  • Figure 50: ' I purchased more Christmas presents online this year than in previous years' , by socio-economic group, 2005-08
• Amazon and eBay attract opposite socio-economic types
  • Figure 51: Most popular sites for Christmas present, by socio-economic group, 2007 and 2008
• Internet User Types
• Types of Internet user
  • Figure 52: Different Internet user types, by gender, age and socio-economic group, January 2008
• Cyber Viewers (14% of Internet users)
• Heavies (21% of Internet users)
• Mediums (24% of Internet users)
• Minimals (41% of Internet users)
  • Figure 53: Online behaviourial groupings, January 2008
  • Figure 54: Online typology groups, by gender, socio-economic group and age, January 2008
• Amount Spent on Online Book Purchasing
• Highlights
  • Figure 55: Amount spent on books purchased over the Internet in the last three months, 2002-08
• Recent online book developments:
• Borders goes on Internet TV
• Amazon launches electronic book reader
• Asda gets into books
• Amazon to buy Audible
• Amount Spent on Online CDs/Tapes/DVDs/Videos Purchasing
• Highlights
  • Figure 56: Amount spent on CDs/tapes/DVDs/videos purchased over the Internet in the last three months, 2002-08
• Recent online music and film developments:
• Pepsi and amazon.com to make music together
• Warner offers unencrypted music
• We7 first ad-supported site to get major backing
• Amazon to commence international rollout of MP3 store
• LOVEFiLM acquires Amazon' s UK and Germany DVD rental business
• Online music sales hit record levels
• Amounts Spent on Online Clothing and Footwear Purchasing
• Highlights
  • Figure 57: Amount spent on clothing and footwear purchased over the Internet in the last three months, 2002-08
• Recent online clothing and footwear developments:Adili gets eco-friendly
• Christmas good for Asos
• Huge growth in online clothes shopping
• Koodos looks to expand
• Handbag.com and LK Bennett in designer shoe giveaway
• Amount Spent on Online Computer Hardware and Software Purchasing
• Highlights
  • Figure 58: Amount spent on computer hardware and software purchased over the Internet in the last three months, 2002-08
• Recent online computer software and hardware developments:Dell, DSGi agree 12-country retail pact
• Tesco to sell Dell computers off- and online
• End of the retail computer shop?
• Amount Spent on Online Entertainment Ticket Purchasing
• Highlights
  • Figure 59: Amount spent on entertainment tickets purchased over the Internet in the last three months, 2002-08
• Recent online entertainment ticket developments:
• Online ticket touts told to clean up act -- but not banned...
• ...but some not impressed
• Ticketmaster moves into UK resales
• Amount Spent on Online Travel Purchasing
• Highlights
  • Figure 60: Amount spent on flights/holidays purchased over the Internet in the last three months, 2002-08
• Recent online travel developments:
• Pay for the tube by your telephone
• Virgin Holidays from Tesco
• Holiday shopping through Internet remains intact in 2007 -- S&P
• Carrentals.co.uk investing for the future
• Amount Spent on Online Grocery Purchasing
• Highlights
  • Figure 61: Amount spent on grocery shopping purchased over the Internet in the last three months, 2002-08
• Recent online grocery developments:
• Ocado finally delivers the goods
• Sainsbury' s is set to rip out auto picking
• Ocado' s service gives online shoppers a merry Christmas
• Online foods less fresh than in-store
• Amount Spent on Online Auction Site Purchasing
• Highlights
  • Figure 62: Amount spent on products from an auction site purchased over the Internet in the last three months, 2002-08
• Recent online auction site developments:
• Play.com offshoot ups ante against Amazon
• EBay CFO says e-commerce growth to slow in 2008
• EBay plans to cut sellers' fees on auction site
• £1.2 billion spent on dud gifts
• Amount Spent on Online Financial Services Purchases
• Highlights
  • Figure 63: Amount spent on financial services-related products purchased over the Internet in the last three months, 2002-08
• Recent developments in online financial services:
• First Direct banks on Apple
• Most borrowers found using the Internet for mortgages
• RBS and NatWest issue e-Statements
• Login systems may force bank customers to log out
• Thomson joins the aggregators
• Appendix -- Internet Users by Demographics
• Detailed consumer demographics
  • Figure 64: British Internet penetration at home/work/place of study or elsewhere, by gender, socio-economic group, age, region and working status, 2001-08
  • Figure 65: British Internet usage profile, by gender, socio-economic group, age and working status, January 2008
• Appendix -- Activities Online
  • Figure 66: Types of activity undertaken on the Internet in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 67: Types of activity undertaken on the Internet in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 68: Types of activity undertaken on the Internet in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 69: Types of activity undertaken on the Internet in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
• Appendix -- Technology Usage
• Detailed consumer demographics
  • Figure 70: Technology usage of digital devices, by gender, age, socio-economic group, region, working status and technology usage, January 2008
  • Figure 71: Technology usage of digital devices, by gender, age, socio-economic group, region, working status and technology usage, January 2008
  • Figure 72: Technology usage of digital devices, by gender, age, socio-economic group, region, working status and technology usage, January 2008
• Appendix -- Browsing the Internet for Informational Purposes
  • Figure 73: Websites browsed for information purposes in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 74: Websites browsed for information purposes in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 75: Websites browsed for information purposes in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 76: Websites browsed for information purposes in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
• Appendix -- Browsing with the Intention of Buying
  • Figure 77: Websites browsed with the intention of buying in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 78: Websites browsed with the intention of buying in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 79: Websites browsed with the intention of buying in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 80: Websites browsed with the intention of buying in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
• Appendix -- Actual Purchasing on the Internet
  • Figure 81: Websites actually purchased from in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 82: Websites actually purchased from in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 83: Websites actually purchased from in the last three months, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
• Appendix -- Christmas Purchasing Experiences
  • Figure 84: Websites used to buy gifts from over the Christmas period, 2007 and 2008
  • Figure 85: Profile of statements agreed with as regards experiences of online Christmas shopping, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 86: Profile of statements agreed with as regards experiences of online Christmas shopping, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008
  • Figure 87: Profile of websites used to buy gifts from over the Christmas 2007 period, by gender, age, socio-economic group, region, working status, household income and presence of children, January 2008