Thursday, 17 April 2014

Online shops raise sales to CZK 18bn before Christmas

2 January 2013

Prague, Dec 30 (CTK) - Czech online shops raised sales by 18 percent year-on-year to almost Kc18bn before Christmas in line with estimates, with about Kc1bn being spent by Czechs on shopping on flash sale websites in the last quarter of 2012, according to data of flash sale sites' association APHN.

Popularity of online shops will continue to increase, according to experts.

"We expect continuation of the trend of customers' shift from the off-line world to the world online. A further double-digit growth of sales can be expected overall on the Internet, as well as on flash sale portals," Michal Hardyn of flash sale comparison website said.

Sales generated by flash sale sites exceeded the amount of Kc3bn for the first time this year, and their importance within online shopping should continue to increase.

"We expect the sales to amount to around Kc3.5bn to Kc4bn next year, which means that the share of flash sale portals on the total online turnover will be growing," Hardyn said.

However, a higher value of shopping will be distributed among fewer portals of which there are now 120.

"This number will certainly drop deep below 100 and the dominant position will be acquired by roughly the 10 largest players," David Antic of APHN said.

Only around 20 to 25 flash sale servers generate sales higher than Kc1m a month now, according to Antic. "Sales exceeding Kc10m a month are generated by five flash sale servers at most," Antic said.

An improvement of quality is to be another trend next year.

"Portals that will want to succeed on a highly competitive market and maintain their position at the top will have to guarantee and insure their vouchers and improve the quality of their refund departments," Hardyn said.

The shift from local services, such as massages, beauty parlours and restaurants, towards high-quality products will continue, he said.

"These will without doubt become the fastest-growing segment of flash sale business," Hardyn added.

Flash portal Seznam TIP, operated by the largest Czech Internet company, has confirmed this strategy. The portal will limit offers of discount services as of 2013, and it instead expects a growth in sale of discount offers of holidays, hotel stays, goods and brand clothing.

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