The UK needs more e-commerce funding.

Why is the UK lagging in the developing world of online transactions?

Why is the UK lagging in the developing world of online


Almost weekly The Sunday Times runs special features on the possibilities

of electronic retailing. But the Brits are stuck behind the US, Canada,

Germany and Japan as well as a host of smaller countries, in the online

shopping league table.

A study conducted by the NOP earlier this year and published by the DTI’s

Information Society Initiative, details the UK position. A global average

of 18% of companies operating web sites are selling goods and services via

them. The UK has only 12%.

Part of the reason is shareholder short-termism - a scepticism for the

idea of seeding this new market, a feeling that it would only cannibalise

the existing market. Whatever they say, one thing is certain. If there are

no British stores on the electronic high street, UK customers will look


Government could help by seed-funding thousands of small-scale retailers

online, simply on the grounds that it would be good for exports, but that

would not eliminate the need for big companies to take the risk with their

own large scale operations. The last government did little to help online

commerce beyond kind words.

The Japanese, by contrast, spent œ57m of public money on 19 projects

including smart cards and electronic purses.

If corporate timidity is the main reason we are lagging behind the global

market, successful American internet case studies (Amazon books, Peapod

groceries) may show that the lack of success of early British attempts was

because they were underfinanced.

BarclaySquare, for example, has made some brave statements, but issued no

evidence that backs up their claims. The DTI report quotes the cybermall

as claiming visits ”have exceeded our wildest exepectations”. Of 300,000

visits to BarclaySquare, 91% were from the UK, but member retailers said

privately they were disappointed. Not surprising considering the lack of

any development budget or publicity campaign until recently.

As part of a vicious circle, online timidity extends to the consumer as

well, and only 1% of UK households have tried online shopping compared to

4% of US and 3% of German. The millenium is coming, but where are the

great visionaries who will build the railroads of the 21st Century? Not

working for UK retailers, that’s for sure.

Nick Rosen is a director of Intervid, a new-media research and design

company. He can be contacted on 0171 240 2200 or


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