Since the fall of Northern Rock last year, most businesses seem to have seen some visible signs of a slowdown in the marketplace. In times when consumers are reining in their spending and companies are feeling the pinch, can the web offer them a lifeline?
Whilst traditional high street retailers were reporting a downturn in sales in the first quarter of 2008, online retail figures were still booming. The latest report from Verdict Research, UK e-Retail 2008, showed that online spending is experiencing its fastest growth rate in six years and shows no signs of slowing. Online stores are perceived to be cheaper and to offer more bargains than their bricks and mortar counterparts and many shoppers seem to be abandoning the high street for the safety of their computer screen in this age of low consumer confidence.
The online dating industry seems to have actually benefitted from the threat of recession. With less disposable income for a night on the town, people are turning to the Internet as a free place to meet people, with some dating websites reporting up to four times the usual number of new members joining in just one month.
Businesses are also rethinking their advertising strategies in response to shrinking budgets. Advertising online can be a lot cheaper; a lot more targeted; and a lot more flexible than television or print. All factors that media buyers are looking for in an economic downturn. Analysts IDC report that they expect online advertising to “expand rapidly” through 2008 and the IAB’s annual online advertising survey showed that internet advertising continues to grow in Europe, despite traditional media experiencing a slowdown.
The repercussions of the credit crunch will be felt for a while yet, but there seem to be some silver linings in the cloud.