A MOVE by one of the country's richest men, James Packer, to bankroll two online retailers is the latest proof that internet retailing is booming and will continue to smack around traditional retailers.

Packer yesterday confirmed that a consortium - including global hedge fund Tiger Management - tipped in $80 million to online retail sites CatchOfTheDay and Scoopon to help them expand into groceries and fashion.

What makes the deal so interesting is that Packer's record in picking online winners has been exemplary. He turned a $33 million investment in online job advertising site Seek.com into $440 million, a $100 million investment in online car ads site carsales.com into $462 million and a $20 million investment in PC Tools into a $60 million investment.

Now comes the decision to push into groceries, electronics, fashion and daily deals, which are going gangbusters on the internet.

The threat of internet retailing to department stores and other fashion outlets has been around for more than a decade, but the threat is fast becoming a reality.

A confluence of factors, including a strong currency, more choice from overseas online sites, increased broadband penetration, continuing comfort in relation to online payment and relatively cheaper products, are all contributing to the migration to online shopping.

The categories most exposed are books, electronics, cosmetics, department stores, clothing and footwear. Not surprisingly, companies such as Myer, Pacific Brands, Harvey Norman and David Jones have been taking a whipping on the ASX.