UK internet economy worth £100bn, says Google

The UK online industry is worth £100bn a year to the economy, according to a new report by Google and The Boston Consulting Group (BCG).

“The Connected Kingdom: How the Internet Is Transforming the U.K. Economy” report says the internet economy makes up 7.2% of the country’s GDP, and will rise to 10% by 2015.

It also reveals the UK is the world’s leading ecommerce economy, exporting £2.80 in goods for every £1 imported. This compares favourably to the offline world, where for every £1 imported only 90p is exported.

The report also estimates 250,000 UK jobs are solely related to driving the internet economy, with an annual turnover of £50bn.

Approximately 62% (31million) of UK adults bought products or services online in the last year, while £50bn was spent on goods and travel.

Over 19 million households (73% of the UK population) have a broadband connection, while 31% of people have used their mobiles to go online.

Matt Brittin, managing director for Google in the UK and Ireland, says: “The sector has come of age, and with great prospects for further growth the UK internet economy will be vital to the UK’s future prosperity.”

Paul Zwillenberg, partner with BCG in London, adds: “Whether they are driving international expansion, improving their interactions with customers or the efficiency of their supply chains, UK companies are increasingly embracing the internet’s potential. Several industries including media, travel, insurance, and fashion, are being transformed by it.”

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Readers' comments (2)

  • Just recently I suggested PayPoint could roll-out a scheme to make buying on line more secure by enabling you to print out your bar-coded purchase arrangement and have it scanned at any PayPoint facility, this they have done. Yet all this Government can do to assist the ‘Net User’ is to offer a feeble one week's trial of the Internet, have they ensured this secure system is publicized? No they have not.

    You may even pay in cash if you so desire and await your purchase to arrive see details here:

    Signed Carl Barron Chairman of agpcuk

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  • As online sales continue to increase and the UK internet economy grows to over £100bn, retailers must ensure that the content and layout of their website provides the best conversion rates possible, in order to stay ahead of the competition. Multivariate testing (MVT) is now widely recognised as the single most effective means of increasing the conversion rate of web site visitors to paying customers. An uplift of 40-50% is not unusual.

    Multivariate testing takes the guesswork out of web design optimisation by testing the measurable reactions of customers to subtly tweaked page layouts, content mix and navigation path. Unlike other forms of such testing, the MVT approach is able to deduce the best combinations from its detailed, integrated analysis.

    Because it uses science rather than gut-feel, MVT overrides the random preferences of senior managers to deliver tangible results. Certainly, there is little point investing £10,000 on pay-per-click advertising, if visitors to the site click off as soon as they’ve landed, due to a poor web site experience, or low relevance of content.

    But randomly applying the technology to the company’s web pages is not going to elicit the desired results. In order to achieve the best outcome, retailers need to recognise the importance of implementing MVT and perpetual, iterative web site enhancement with a clear strategy, and under the close guidance of experts who know what they’re looking for.

    Multivariate testing is not something that can be done once, or even once a year, and then left alone for a while as the higher revenues come in. It is a discipline and a service that must be built into companies’ ongoing marketing programmes. In the web world, things move at a lightning pace, and hungry competitors are always looking for their next advantage. Blink, and the golden moment may have passed.

    Mark Simpson
    Founder and President

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