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Online retail sales reach 24-month peak

By Retail Technology | Tuesday July 16 2013

Online retailing index finds last monthÂ’s sales highest in two years, with clothing sector boost, up 29% on previous month

Figures from the IMRG Capgemini e-Retail Sales Index reveal that online retail sales grew by 20% year-on-year in June – the highest recorded growth in two years. 

The figures further found monthly growth of 2.4% on May 2013, the first time the Index has recorded a rise between May and June in five years.

The Index reveals a solid second quarter of the year, with online sales up 17% on average on the same period in 2012, exceeding earlier predictions of 12%. However, it also noted consumers remain under pressure as inflation outstrips wage growth. The average basket value (excluding travel) in June stood at £79, down 9% compared to £87 in June 2012, as shoppers took advantage of seasonal promotions online – boosting online sales while reducing average basket value.

Warm weather boosts clothing sales

In terms of sectors performing well, clothing saw 29% year-on-year growth in June, as the warm weather encouraged shoppers to update their summer wardrobes. Sales for home and garden products were also up 35% year-on-year on a like-for-like basis in June. Travel sales were also up 15% year-on-year and 4% on May 2013.

The M-Commerce Index continued to grow, up 136% year-on-year in June and 8% on May 2013. Conversion rates via mobile devices increased from 1.27% in June 2012 to 2.03% in June 2013, as spending via tablets increases driving conversation rates closer to that of desktops.
Tina Spooner, chief information officer at IMRG, pointed out that the online retail market performed above expectation so far this year, with the first half of 2013 coming in at 16% average growth against the trade body’s earlier forecast of 12%. “We haven’t seen the rate of year-on-year growth recorded in June for two years, which is around the time confidence in an economic recovery seemed to be heading toward its lowest ebb,” she commented.

Consumer confidence on the rebound

Chris Webster, vice president and head of retail consulting and technology at Capgemini, added: “The uplift experienced this month will provide retailers with a note of cheer, with the Index recording its biggest year-on-year growth since June 2011 and Q2 being 17% up on Q2 2012. 

"This is in stark contrast to the continued decline in store footfall reported by the BRC over the first half of the year and amplifies the increase of online at the expense of store sales. In addition, Britons remain price-conscious, but have responded well to good deals found online and it’s good to see consumer confidence returning.”

Webster also said the mobile M-Commerce Index remains strong as consumer confidence in purchasing goods and services via smartphones and tablets continue to grow. “The findings provide further evidence of the value mobile technologies have brought to the retail sector as consumers continue to shop via this channel,” he concluded.

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