Internet shopping

Launched: April 2006

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Purpose of the study

To examine whether consumers:

• are confident when shopping on the Internet
• receive the right level of regulatory protection
• are aware of their rights when shopping online; and whether businesses understand and comply with the regulations for online shopping.

(Study followed in-house work.)

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Findings

The study found that shoppers could find better deals by searching more effectively, many could do more to protect themselves online, and most did not know that they have cancellation rights when shopping on the internet.

The study also found that many businesses did not know their obligations under the Distance Selling Regulations which provide additional protection for shoppers when buying online. Some businesses could also do more to address consumers' concerns about privacy and security.

The fact-finding study identified some areas where more could be done to ensure people get the most from buying online, and how they can feel confident and protected when doing so.

The findings include:

• awareness of online shoppers' rights is low for businesses and consumers
• the anonymity, speed of change and borderless nature of the internet, can pose particular challenges for the enforcers of shoppers' rights
• shoppers have significant fears about security and privacy, which put some off buying online altogether
• by searching more effectively, shoppers can find big savings.

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Recommendations

The study recommended further OFT work with consumer groups, businesses and other public bodies to:

1. ensure that businesses have easy access to clear information and advice about selling online

2. advise shoppers how to protect themselves from security and privacy threats

3. make sure businesses address shoppers' concerns in terms of avoiding the most frequent problems by providing contact details and a secure environment, and

4. improve compliance and enforcement, to make the internet a safer environment for buying and selling, and build consumer confidence in internet shopping.

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Action following market study

The OFT:

• prepared information materials to supplement existing OFT guidance, integrating them into the Consumer Direct web site
  
  
• updated their advice to business web pages, including a summary of key regulatory requirements and advice for small firms on online security
  
  
• worked with the Consumer Education Alliance to distribute materials
  
  
• secured agreement of top five internet auction sites to provide information to consumers about their rights and to provide clearer identification of traders
  
  
• secured the agreement of key price comparison sites to give consumer information and links to Consumer Direct web site
  
  
• coordinated a web sweep by trading standards services officers in 90 local authorities of over 500 top internet retailers to assess their websites' compliance with key requirements of the distance selling and e-commerce regulations
  
  
• published web sweep report March 2008.

Results suggested most large online retailers were complying with the DSRs and E-Commerce Regulations: There was room for improvement in relation to providing a physical address, information on right to cancel, information on additional charges.

See press release for more information.

In May 2009 the OFT published a comparison of pre and post study consumer research on Internet Shopping (see Findings from consumer surveys on internet shopping 11 May 2009 (pdf 227 kb)).

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Market study details and report

Download Internet shopping: an OFT market study (pdf 1.17mb)

Annexes - all pdf files

• Annexe A - Glossary of terms (124 kb)
• Annexe B - Methodology (113 kb)
• Annexe C - Bibliography (170 kb)
• Annexe D - Media review (168 kb)
• Annexe E - Consumer attitudes review (688 kb) 
• Annexe F - Economic literature review (429 kb)
• Annexe G - Enforcement review (161 kb)
• Annexe H - Consumer survey report (843 kb)
• Annexe I - Consumer FG report (145 kb)
• Annexe J - Business survey report (589 kb)
• Annexe K - Omnibus survey report (185 kb)
• Annexe L - Research into Internet shopping (377 kb) 

See press release 'OFT report says consumers and businesses could get more out of the internet' 19 June 2007

See the OFT awareness campaign: Selling online or at the distance July 2007

See press release  'Internet auction sites agree to highlight consumer rights' 14 November 2007

Download the web sweep analysis 7 March 2008 (pdf file 436 kb)

See press release 'OFT publishes web sweep results for top online retailers' 7 March 2008

Download  Findings from consumer surveys on internet shopping 11 May 2009 (pdf file 227 kb)

See press release 'More to do to improve consumer trust online' 11 May 2009

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Background information

27 April 2006: the OFT launches a new fact-finding study into internet shopping - see press release

Back to: Completed market studies