High-street retailing is currently undergoing a major transformation, and it is one that favours those businesses that can react quickly to new technology and can take steps to meet the changing needs of customers. Success is in the hands of the agile retailer.

Retailers can be forgiven if they are confused about how the internet is fundamentally changing their business. In a desire to explain, industry commentators create ever more jargon to describe the increasing influence of online retailing. Over the past couple of years terms such as multichannel retail, cross-channel retail and now even omnichannel retailing have been used to explain these changes. But what does all of this mean practically, for you and your business?

Whatever you choose to call it; online retailing, ecommerce, or simply selling online is rapidly establishing itself at the centre of the most successful retail operations. It’s certainly where most of the sales growth has been seen during 2008. Online sales grew at 20-30% for the year, and this helped some of our larger retail groups to avoid major embarrassment when announcing their overall results this January. Online retailing has also given many small retailers the opportunity to out-manoeuvre their larger competitors, many of which have been struggling to adjust to a new, and fast-evolving retail model. Some of the high-profile retail business failures seen recently have doubtless been tipped over by a massive tightening of credit, but the majority of these were already compromised businesses without a well-defined and successful online operation. The downturn has merely exposed their weakness.

Most consumers now have a broadband internet connection available to them either at home or at work. And when you look at the peaks and troughs of daily online retail activity, it reflects the pattern of the average day with peaks mid-morning, lunchtime and mid-evening - times when people have time to shop online, fitting it in around their chores and other activities. The development of new technology has a large part to play in helping us to understand how online retail habits will continue to evolve. A point in time when most of us have an easy-to-use internet-connected device in our pockets is approaching fast. The phrase ‘easy-to-use’ is the key here; most current mobile phones will connect to the internet - but the experience is far from great, and most people don’t bother. With devices such as the category-defining Apple iPhone, and the coming of Google’s own mobile phone operating system, Android, we will see a vast array of new, user-friendly smartphones entering the market and seducing users to start using the internet on the move. The impact this will have on online retailing is huge, because if people start shopping online while they are out and about in town then this presents retailers with a fantastic new opportunity to build stronger, more active relationships with their customers.

Building relationships is a fundamental part of human nature, and it is second nature to all successful retail operations. The internet brings new ways to create and maintain relationships with customers. A consumer dealing with an agile retailer can often start a transaction in-store, and complete it at home on the internet, or alternatively find a product on the internet and reserve and buy it in-store. And we are beginning to treat this type of flexibility as a requirement to retain our loyalty. The relationship is simple - do what we want and we will buy from you. Allow an inflexible system to stand in our way, and we will simply side-step you and shop elsewhere.

The internet has allowed us all an unprecedented facility to find just about anything we want to know, almost instantly. As a result that Great British institution, the Pub Quiz, is now threatened by savvy contestants looking up the answers on Google as the questions are read out. This facility for instant research is one of the factors that is changing retail. Comparison shopping has become the norm across all retail channels. Physically going into four competing stores to compare prices, even in the same town centre, may take an hour or two. The same task can be completed in as many minutes and is merely a click away on the internet.

As customers become more cautious about their spending then research is becoming the norm for all but the most mundane and regular purchases. Visit your local branch of Comet and it looks like a reporters' convention; people with notebooks and pens jotting down product names and reference codes before rushing off to locate the best prices online for next-day delivery - maybe even from Comet. The potential threats from this behaviour are obvious, but the opportunities for the agile retailer are also there to be exploited.

Consumer research consistently shows that price is certainly not the only factor that determines an online retail purchase. There are many factors that make up the value proposition presented to customers. Speed of delivery, certainty of price - led by free or fixed price delivery, security of payment and overall confidence in the retailer all play a part. As with all retail purchases, consumers balance their needs, desires and expectations and make decisions about what to buy and who to buy from as a result. Many companies sell online at higher prices than their competitors and still make the sales where they can offer an overall more compelling value proposition to their customers. Quite simply - there is room for everyone but beware, opportunistic high prices are impossible to sustain in the bright glare of internet comparison shopping.

Core retail values have always centred on customer service - providing the customer with the products they want, when they want them and at prices they are prepared to pay. The values of online retailing are fundamentally no different from this and retailers who understand this are currently winning market share. The same customers who buy from you in-store also buy from you online. Studies into the demographics for internet shopping show very little variation across age groups and most of the social classes. You can be pretty sure that the customer coming through the door is the same customer who is also buying from your website. The agile retailer recognises this and treats them to the same experience and service, the same offers and makes sure they are aware of all of the channels available to them to browse and make a purchase.

The ability to collect and analyse customer behaviour is the golden goose of online retailing - and one that keeps on laying. When someone buys from you online you know who they are, their name, address, email address, what they bought and when. This level of intelligence is much more difficult to gather from store customers and should be used to present the customer with relevant offers and product information that will then bring them back to your business, either online or in-store. It also provides you with the vital feedback you need to develop the business.

2009 will doubtless see more retail failures, but these will not include retailers who understand and act upon the opportunities that the internet presents to them. Internet retailing currently accounts for less than 20% of all retail spending in the UK, but by 2020 it is expected that the internet will be the channel used to influence over 90% of all retail purchases. It is the agile retailers who will be the success stories over the coming few years.