Neglecting online services costs retailers £500m in lost sales

Oxford Economics said Morrisons, the supermarket chain could be losing out on £314m in potential digital sales

Morrisons has announced plans to launch its web-based home delivery service. Photograph Alamy

Some of the biggest names on the high street are losing hundreds of millions of pounds by failing to keep their websites and smartphone apps up to scratch.

Experts at Oxford Economics said some of the UK's top retailers, including Morrisions, Dixons and Phones4U, have lost up to £500m in annual sales by "neglecting" their online sales potential.

"We found a clear link between growth and multi-channel performance," said Sam Moore, director of consulting services at Oxford Economics. "This confirms there is a commercial incentive to invest in a digital multi-channel strategy."

The research by digital agency Head London named Morrisons, the nation's fourth-biggest supermarket, after Tesco, Asda and Sainsbury's, as the biggest laggard in the online world. It found the Yorkshire-based chain is losing out on up to £314m in potential digital sales by not offering an internet shopping and home delivery service. In contrast Tesco, which offers a plethora of digital services including web and phone-based services, is said to have made an extra £255m from its online efforts.

This month Morrisons announced plans to launch its web-based food delivery service by 2013. The company has hired Simon Thompson, Apple's former internet store director, to help drive its long-awaited move online.

It has bought FreshDirect, the US online grocer and Kiddicare, the online baby goods retailer. "Thompson's recruitment is a clear and bold statement of intent in terms of Morrisons' online plans for the future," said RBS analyst Justin Scarborough.

Paul-Jervis Heath of Head London, said: "Too many retailers are behind the digital curve," said Paul-Jervis Heath of Head London, said: "They usually have a mobile website, and even an app, but too often these services are not joined up. By not giving customers the information they need on the platform of their choice they are less likely to complete purchases."

Homebase, Sports Direct and DFS were also highlighted as companies offering a poor or disjointed online experience.