One of Britain’s biggest websites yesterday insisted that the rapid growth of the internet would help it to ride out the consumer spending slump that is threatening to hammer the high street.Play.com, the Jersey-based rival to both eBay and Amazon, said it expected sales growth of up to 30 per cent in the coming year.
Richard Goulding, the chairman and co-founder, said that the business would continue to look to expand into areas away from its traditional domain of CDs and DVDs. A new music download service to rival Apple’s iTunes will be unveiled in four to six weeks. It will offer as many as one million songs. Mr Goulding said: “We believe PlayDigital will compliment our music offering by giving customers more music to choose from and more ways in which to consume it.”
The comments came as Play.com reported a 24 per cent surge in orders in the run-up to Christmas. Nearly one million customers visited the website on its busiest day, December 3.
Play.com’s turnover in the 12 months to January 31 is likely to hit £340 million, up from £290 million last year.
“I still believe the internet is in its infancy. I wouldn’t be surprised to see half of all of shopping done online, maybe by 2018 or 2025,” Mr Goulding said. “The internet will continue to grow as more and more products come online and more and more companies begin to offer their services online.” He added: “People like HMV have got a hard time ahead of them and that’s why they are moving more into online. I can’t see why anyone would get into a car, buy a parking ticket and take the time to go to a shop just to pick up the latest Kylie Minogue CD.”
Play.com’s optimism came after Brian McBride, Amazon UK’s chief executive, gave warning last week that high street retailers would have to “shape up” to survive.
The bullish outlook from Mr Goulding is the latest sign that internet operators believe they will be insulated from any squeeze on consumers’ spending. IMRG, the internet monitor, last week said that about 17 per cent of consumer spending on retail, travel and leisure was now carried out online. It believes this could rise to 50 per cent by 2018.
DSG International yesterday said that Dixons.co.uk reported a 40 per cent rise in orders on Boxing Day.
Mr Goulding founded the business with close friend Simon Perrée, now chief executive, in 1998 after spotting DVDs for the first time on a trip to the United States. The group has since expanded into mobile phones, electricals and clothing.
Mr Goulding yesterday reiterated there were no plans for a stock market float, at least for the next “couple of years”.
He said: “We have looked at that previously, thinking that it would provide us with a one-off cash injection to be able to expand into three or four countries in Europe at once, but it’s always outweighed by the fact we like being a private company. It allows us to be much more nimble.”
