ONS struggles to define ecommerce revenues

Could do better, UK statisticians admit

By Startups.co.uk, 20th January 2006

The growing popularity of online shopping has transformed from just another showroom for selling goods into a driver of economic growth, the Office for National Statistics (ONS) claims.

In an article examining trends in online spending, published yesterday, the country’s official statistician acknowledges that its coverage of ecommerce should be revamped.

The ONS includes internet sales in its coverage of the retail sector, but it says that growth in industry sub-sectors, such as online gambling and gaming, international purchases, software and specialist online retailers, now warrant separation into a wider category of study.

“Although coverage of internet spending is good, there are some areas where future work is needed to ensure coverage is as good as possible,” the ONS said.

“The most important area is the increasing use of the internet to make purchases from abroad. Traditional trade data may not be covering all areas where internet purchasing is taking place and this needs further investigation.”

The authors suggested the ONS should also look more closely at small but fast-growing markets, such as ringtones and downloadable music.

More than 55 per cent of households in Britain have access to the internet. It is this statistic that has largely driven the sector’s sales, which topped £18.1bn in 2004. But the ONS said that a growing number of businesses are getting in on the act.

“The internet is not only an expanding channel for household and business spending, but it is also a driver for productivity growth,” it said.