UK Markets Surges Ahead In Online Buying
A leading UK wholesaler has jettisoned an ambitious project of merging the television and the Internet for advertising and e-commerce after less than a year of operations. The primary reason cited by the company was weak advertising and e-commerce revenues from the project. The ambitious project is most likely to be dissolved in two to three months’ time.
The project was touted as a highly innovative experiment and was expected to earn the UK supplier good revenue through online sales. However, e-commerce and advertising revenues were not at all along expected lines, forcing the decision to close down operations. It is expected that about twenty jobs will be lost as the venture plans to close down shortly. About 14 million USD was invested in the project to date.
E-commerce observers believe that the current market conditions are not ideal for testing this type of concept and that the company seems to have suffered from a case of bad timing in pushing a project that perhaps has good potential for success in the future. Interestingly, the failure of the project comes in the wake of market research, which clearly stated that the Internet has a profound influence on consumer behavior patterns, especially in Europe.
The failure of this project is particularly painful for this leading wholesaler because another UK web-based grocery business, with which it is in direct competition, has started making its presence felt in the UK and the US as well through their Internet-based promotions. In fact, it has made a $22 million investment in an online operations network in the US.
It is generally observed that UK and European shoppers are taking to the online route faster than their US counterparts. The UK wholesaler can take solace from the fact that there is good potential in the future for growth through the online route, and only the current market situation is primarily responsible for the setback.