Are marketers using the online shopping phenomenon to their advantage and, if not, what improvements can be made?

Internet advertisers will no doubt be humbled by new statistics that suggest the popularity of online shopping is increasing, with no signs of its success abating any time soon. The PayPal Online Retail Report highlights that over the next 18 months alone, the sector will expand by more than 36 per cent, compared to just one per cent for sales made in-store.

Undertaken by Experian, the report suggests that the trend will be fuelled by more people being able to access the internet and the growing belief that doing so can save them money. Carl Scheible, managing director of PayPal UK, commented: "Two-thirds of online shoppers are now convinced their money goes further online compared to less than half who believed it last year, an increase of 8.5 million people. The success of online retail really is the silver lining in the economic crisis."

Predictions suggest that one in every £10 will be spent online by 2012, giving internet advertisers a wide consumer base to target. Store-based retail is expected by the report's authors to increase by £3.3 billion - or one per cent - by the end of 2012, while online sales will expand by £8 billion.

Consumer perceptions of the internet have helped fuelled its success, with not only cash savings but also cutting down on time attracting people to the online domain. Mr Scheible noted that faster payment options when making purchases have also played their part.

According to a recent survey conducted by OnePoll for elephant.co.uk, PC-savvy Brits have each saved £27,024 since the millennium by shopping online. The statistics showed the biggest saving is being made on the weekly food shop, which has declined from £71.22 spent in-store to £48.98 online.