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Warm weather hits online sales growth

Online sales posted the weakest annual growth since January 2010, rising by just 9 per cent in July, according to the IMRG Capgemini e-Retail Sales Index.

The Index, which gathers information from over a hundred retailers including Arcadia Group, also recorded the first ever negative growth between June and July of two per cent, following a 20 per cent surge in annual growth in June.

“There is no doubt that the prolonged heat-wave had a detrimental effect for online retailers. Following the coldest spring in over 50 years, it is hardly surprising that Britons headed outside when the much-needed sunshine appeared”, said Tina Spooner, Chief Information Officer at IMRG.

For the first half of 2013 (January – June), the Index had performed well above expectation; the average growth was 16 per cent against the forecast of 12 per cent for the year. July was a ‘golden month’ for retailers enjoying the strongest rise for seven years with online and physical stores posting strong increases.

Despite a fall in sales, online-only retailers outperformed their multichannel counterparts in July. Online-only saw an increase of 13 per cent year-on-year, while retailers which have both a physical and online presence recorded just 6 per cent growth, the lowest reported by the Index for this group since IMRG and Capgemini started tracking it in 2010.

Weak year-on-year rises were recorded across most categories, including electricals (2 per cent), health and beauty (3 per cent) and travel (3 per cent). Brits also spent less money online in July, with the average online basket value at £72, a fall of 15 per cent compared with July 2012.

Consumers opted to improve their homes and gardens and took advantage of the hot weather as Home and Garden saw a huge 37 per cent year-on-year rise in July. Beers, wines and spirits were also up 23 per cent year-on-year during the month. On a week-by-week basis, the week commencing 15th July saw total e-retail sales grow 25 per cent on the prior week (8th July). This was boosted by the Clothing sector, which grew by 56 per cent on the first week of the month, as retailers launched their seasonal promotions.

The M-Commerce Index grew by 129 per cent year-on-year in July which was ‘slightly perplexing.’ Oliver Ripley, Mobile Product Manager, eCommera added: “This is perhaps due to the fact that many consumers chose to do their shopping while reclining in the garden on a deckchair or a hammock. What is clear is that hot weather favours m-commerce.”

However, the conversion rate via smartphones and tablets improved over the past year and was 2.5 per cent in July

Source : Michael Somerville – Retail Gazette

19 August 2013
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