Online sales rocket by 19% in UK
Online sales in the UK have grown by 19% during the first half of the year, with British shoppers spending £31.5bn. The latest figures from the IMRG Capgemini e-Retail Sales Index have revealed a “better-than-expected” performance for online sales during the first six months of 2011.
Online spend was also 1% ahead of IMRG and Capgemini’s growth forecast for the period back in January.
Growth is due to several key factors: a struggling economy and high-street has driven shoppers online for better deals; a scorching April saw shoppers jump online early to add to their summer wardrobes, while summer downpours have increased the appeal of in-doors shopping; and the Royal Wedding encouraged Brits to get into the party spirit with massive alcohol spend online, IMRG said.
As for June itself, a total of £5.3bn was spent online, 21% more than June 2010, and equivalent to £86 per person. This growth far exceeds that witnessed on the high-street, which reported a like-for-like drop of 0.6% on the same period last year.
Clothing in particular saw strong growth in June, reporting a 31% increase on June 2010. This significant result for e-retail is in contrast to the stagnant sales of clothing witnessed offline.
Travel also saw continued growth last month, leaping 14% year-on-year and 4% on May. This is likely to be attributed to a very mild June, the coolest since 2001, which encouraged Brits to travel abroad this summer in hunt of warmer climes.
Alcohol was another sector that recorded a solid performance last month, with year-on-year growth of 10%, as did the gift sector, which reported a 14% increase from May, driven largely by Father’s Day on the 19 June. The Index supported this finding, indicating that e-retail sales peaked in the two weeks prior to Father’s Day.
Chris Webster, head of retail consulting and technology at Capgemini said: “A 21% year-on-year increase in June is a perfect way to round off the first half of 2011, as it is consistent with what has been to date a very strong year. Bank holidays, soggy weekends and major sporting events encourage us to go online for our shopping – it’s quick, it’s convenient and we can do it 365 days a year. What’s more, we don’t need to be armed with an umbrella. It will be interesting to see whether the Index can maintain growth off the back of strong growth in the second half of 2010.”
David Smith, chief marketing & communications officer at IMRG added: “Many were predicting a tough year for retail in 2011 and in the high street that has proved to be the case, but the online market has actually grown by 19% over the first half of the year. This figure is currently 1% ahead of our prediction for the year, so a really positive start overall. The rise in June of 21% is actually the strongest y-on-y growth recorded in the Index since January, so online is really booming. This growth has probably been influenced by the huge sales being put on by high street retailers, which would have to be mirrored across their e-commerce sites too.
“The modern retail market is dictated by what the consumer wants, and online is becoming ever-more central to our shopping behaviour. Both Sports Direct and SuperDry have released figures recently showing that their e-commerce sales have doubled in the space of a year from around 4% to 8% of total revenue. These results clearly demonstrate the potential for multichannel retailers to greatly increase their margins by successfully integrating their available channels. ASOS reported 15% growth for Q1, lower than the market average and suggesting maturity for them in the UK market, but including their overseas figures that growth rises to 69%. ASOS are a leading light in terms of opportunities in the international market.”
