Lowest level of growth since January 2010 still hits double figures with boost from Valentine’s Day spending

Lowest level of growth since January 2010 still hits double figures with boost from Valentine’s Day spending

The latest figures from the IMRG Capgemini e-Retail Sales Index recorded its lowest level of year-on-year growth since January 2010, as retailers last month felt the fallout from a strong beginning to this year.

Shoppers in the UK spent a total of £5.4 billion online during February; up 10% on the same time last year, but representing a growth rate of just half that recorded in February 2011 (20%) and down £600,000 on spending during the preceding month.

The Index found Valentine’s Day helped boost sales in the e-retail sectors traditionally associated with romantic presents, including gifts, which grew 26% month-on-month and 22% year-on-year. Similarly, the lingerie and health & beauty sectors saw a year-on-year jump of 27% and 32% respectively. And the clothing sector has continued to perform at an unusually low level for the fourth consecutive month, recording just 9% year-on-year growth in February.

Tina Spooner, IMRG chief information officer, commented: “Although growth in e-retail sales was lower than expected in February, it has to be considered in the context of the 20% rise seen in February 2011, so double-digit growth is still a positive result."

Online-only retailers close multichannel gap

Online-only and catalogue retailers recorded year-on-year growth of 13%, exceeding multichannel retailers with a High Street presence, who recorded growth of just 8%. This is the second consecutive month that online-only/catalogue has outperformed multichannel retailers.

Chris Webster, Capgemini UK head of retail consulting and technology, said: “It is very interesting to see the growth of online-only retailers exceeding that of the multichannel. Low footfall and a disappointing performance on the High Street could be affecting the multichannel retailers’ online counterparts. Online-only retailers’ rapid innovation and adoption of growth areas in e-retail, driven by mobile and click ‘n’ collect, seem to have put them ahead once again; now is the time for the multichannel retailers to respond.”

“It appears evident from the sales growth recorded by online-only/catalogue retailers over recent months that consumer confidence in the online channel is increasing,” Spooner added. “These results suggest consumers who may have initially looked to trusted High Street brands when shopping online for the first time are now becoming more confident in purchasing from pure-play e-retailers. It is also interesting to note that the average e-retail spend for online-only/catalogue retailers is 10% higher than during the same month last year, while for multichannel/High Street it is actually 8% lower.”