If 2009 was the year stock market-listed retailers officially woke up to e-commerce*, then 2014 was the year online retailing exploded onto the investment scene.
Of course, for almost two decades now the far-sighted few have known the potential. But we think the explosion of demand for stocks and shares this year is in part because investors have realised that the broader retail market in the UK is so far behind consumer demand.
Move over supermarkets and out-of-town retail warehouses - step forward internet pure-plays.
The latest valuations of the second generation of pure-plays are around four times sales - reflecting the levels of supply as well as the level of demand.
Yes, its very high - and we'll come back to that later. But why did it take so long for investors to wake up and then for smaller, fast growing firms to arrive on the market?
Certainly a lot of firms seem to have reached an investment ceiling early on in their growth curves which has clogged up the pipeline. My-Wardrobe stalled and M and M Direct, now eyeing a possible IPO, seems to have hit a difficult peak at around £100 million.
The Hut Group, long mooted as an IPO candidate, has also struggled to grow some of its businesses beyond medium-sized concerns.
So what has changed over the past 18 months that meant AO World - formerly Appliance Online - was valued at £300 million in Autumn, to £1.2 billion when it listed last month and is now worth £1.4 billion according to its share price on Friday?
Boohoo.com has also seen a similar meteoric rise. When the IPO (initial public offering) was first marketed to potential shareholders late last year, one newspaper market report went so far to say that investors had 'baulked' at its £500 million price tag.
Far from baulking, investors were queuing up to buy the shares two weeks ago. The price at the close of the market on Friday valued the e-commerce pure-play at £702 million - despite being shaken a little last week by the profit warning issued by Asos.
We cannot be sure these business will deliver but investors haven't needed much convincing.
Of course, the headlines have declared an 'online bubble'. But what both bull and bear commentators have forgotten is the danger of judging everything on extreme fundamentals.
Let's be honest, there is a shift in the consumer economy taking place that is nothing short of a landslide. Supermarkets, who for so long have brought their own landslide effect to the retail sector, are in disarray and a company like online grocer Ocado is currently valued at £2.75 billion despite not yet having made a pretax profit.
That is more than half as much as Morrisons even though the supermarket chain is next year expected to 'only' make £375 million profit as it uses more cash to invest in the future.
The Global Perspective - 'the package, the parcel and the box'
What has changed is the potential for global domination. Asos has proved that it is possible to take on giants like Amazon on their own turf and, at least for now, make it look relatively easy.
It may have shaken investors with plans to invest and re-energise last week but investors in Asos have doubted before and come unstuck. It is still well set to be a global player even if the valuation in the sort term is beginning to look a high.
But does that apply to everyone? One of the fundamental issues is the difference between the package, the parcel and the box.
The package is a wonderfully deliverable and exportable commodity. CDs and books are packagable items and were the first to go global.
The package was next - mainly clothes and other items that could easily be dropped off at the post office for collection, left behind the bin in the back yard or at the local convenience store.
Again, relatively easy and digestible for the existing framework of ecommerce, not just at home in the UK but overseas.
But with boxes we have much more of an issue. The box is not an easily deliverable product. Think of a box containing a heavy dinner set, a washing machine or your weekly groceries.
Try slotting those through the door, behind the shed or leaving them at the local Londis.
A completely different framework is required - one that can cope not just with delivery but with the prospect of something not being delivered. Specialist drivers with a strong arm places to leave the products if they don't immediately reach their destination.
Long distances are not good for these types of produce in a world where customers are less keen to pay through the nose for delivery.
Transplant that overseas and the cost of setting up in each new country could be infinitely more expensive than for the package and the parcel man.
A Fragmenting Market
Add to that the possibility of a fragmentation in individual markets. Take wiggle for example - its not just a cycling etailer but also sells running gear, swimming gear and equipment for triathlons. Great if you are sure that your brand can support interest across those product areas and defend itself if smaller specialists like Zoggs.com (which specialises in selling swimming goggles and makes around £15 million a year) and larger, aggressive rivals like Sports Direct.
Not so great if the disruptive forces become too much. We also need to ask just how big is the ceiling for these markets, what are the barriers to entry and what international competition might be like.
But, as with the parcels and packages markets, we think the big difference again comes with the fashion retailers. Asos is as much a fashion brand as the products it sells, as well as having developed its own ranges. Boohoo similarly targets the 16-25 year old girl - and, more recently, boy - which is a much larger market with a brand that seems to have gained a solid foothold against many of its high street rivals.
Their consumers are also broad-based and so is that of Boohoo which has also already proven itself to have global potential - around a third of sales at the moment are from overseas even at this early stage in its development.
Barriers to entry for a brand like Boohoo are relatively high. Yes, there are lots of imitators but none so big - not yet anyway. You are not just buying other people's brands and selling them on at competitive prices but creating your own product and brand.
For Ocado to scale up internationally could take years. AO World has plans to launch in Germany this year. Both will need time to bed in, cope with local disruptors, and find new markets and, in the case of Ocado, new partners like Morrisons.
But for Boohoo - which is half as old as both those companies - international growth happened, more or less, with the flick of a switch. The same goes for Asos.
Do we believe that Boohoo is worth £702 million? Well if you assume it will continue to grow at its current rate of 70 per cent a year for the next four years it will be turning over £960 million.
That's more than Ocado's £843 million sales last year and you could assume it would be a lot more profitable than Ocado is at present.
What concerns us most with these high valuations and the knee jerk, negative reaction against them is the risk of a backlash damaging the development of the market.
As we can see from the above, we are lumping together some vastly different business and trying to compare for easy valuations. Of course its a good starting point but that's all it should be.
Hopefully the odd bit of caution - as was helpfully delivered by Asos last week - will help investors to stand back and look at these businesses as individual cases.
*Back in April last year we analysed how slow many of the big department stores were to catch on to online retail and 2008/2009 seems to have been a key year - better late than never: see 'Cracking Fashion's Middle Market' from April 21, 2013.
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