Britain's online sales surge

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LONDON, Jan 4 (Reuters) Online retailers look set to be crowned among the victors of Britain's Christmas trading war after millions of shoppers chose cyberspace over the high street.

Internet sales in Britain are predicted to have surged 50 per cent this Christmas and for the first time to have peaked during the start of seasonal discounting last week, online retail tracker IMRG reported on Wednesday.

It was the opposite story for Britain's high street with the number of Britons visiting stores down 6.8 per cent in the week after Christmas, according to data from Foot Fall.

''This has definitely been an online Christmas,'' James Roper, chief executive of the Interactive Media in Retail Group (IMRG) said in a telephone interview. ''We think 25 million people now shop on the Internet.'' Roper predicted online Christmas sales are looking to be around half a billion pounds better than already strong industry forecasts and will top 7.5 billion pounds ( billion) in the 10 weeks leading up to the holiday.

More surprisingly, Roper said data from IMRG and eDigital Research showed that unlike in previous years, there was no sign of a post-Christmas fall in online demand.

Instead, visits to the online stores of leading British retailers on December. 27 -- the start of the holiday discounting season -- spiked 30 per cent higher than any previous peak.

''The young Internet shopping industry is already a huge success, with potential to continue to grow at 40 per cent per annum for the foreseeable future,'' Roper said.

Early reports suggest British retailers made an uneven showing during crucial Christmas trading while many consumers struggled with soaring household bills, higher borrowing costs and tame wage growth.

However, there are indications a strong Internet strategy will have helped to separate winners from the losers.

Tesco, the world's fifth largest retailer, which forecast a ''good Christmas'', saw visitors to Tesco.com swell to 1.3 million over the holiday period. PC World and Curry's are expected to benefit from parent company DSG International's early push into online selling.

Analysts predict the Christmas fortunes of clothing retailer Next, which reports on Thursday, rest on the success of its home and online shopping Directory business.

''Part of the reason why high street retailers are having a tough time is due to the inexorable rise of home shopping via the Internet,'' Investec Securities analyst Mark Charnock wrote in a note last month.

Among those hardest hit are sellers of music and movies who are suffering from a boom in downloads from the likes of iTunes.

Woolworths and HMV issued profit warnings before Christmas while Music Zone, a private equity-owned DVD store, filed for administration on Wednesday.

Data from Internet tracker Hitwise showed visits to music download sites rose 50 percent from Christmas Day 2005.