Sales through phones grew by 47%, year-on-year in December, according to the latest IMRG Capgemini eRetail Sales Index, and accounted for 54% of all sales made via a mobile device. Tablets accounted for the other 46%.
This time last year, smartphones were the device of choice for 39% of sales via a mobile device. This year, sales made via a tablet were down by 3%, year-on-year.
Justin Opie, managing director, at IMRG, explains: “Following a below-expectation year in 2015, online sales growth has shot back up to an extent that seemed highly unlikely at the start of the year. There are two key factors driving this. The first is that Black Friday became an ‘online’ event in 2015, and this seems to have had a lasting effect on people’s shopping behaviour and preferences – our Index has recorded strong growth for online sales ever since that day. The second is that sales through smartphones are continuing to grow at a very strong rate, which is increasing the times and places in which people can browse and engage with online retailers.”
This has driven what IMRG [IRDX VIMR] sees as exceptional ecommerce growth. The IMRG Capgemini eRetail Sales Index says the growth went well beyond the 11% it predicted at the start of the year and reversed a trend of declining growth rates. For 2017, the Index suggests shoppers will spend 14% more than in 2016.
Who did best?
IMRG/CapGemini’s findings have been bourn out by various retailers that reported their Christmas results this week. Mobile traffic to Shop Direct sites, which include Very.co.uk [IRDX RVER], ranked Top100 in IRUK Top500 research, and Littlewoods.com [IRDX RLIW], a Top100 retail brand, grew by 30% year-on-year.
At Very.co.uk [IRDX RVER], 68% of online sales were made via mobile devices – and 55% via smartphone alone. Mobile sales were up by 29% year-on-year, overall, and smartphone sales by 45%.
Shop Direct put that growth down in part to its mobile strategy. One example of that was Littlewoods’ iOS app, which launched in early November. It also used Canvas mobile ad technology from Facebook to offer deals to new and existing customers via social media.
Shop Direct chief executive Alex Baldock explains: “Shoppers chose convenience; being able to shop via smartphone was top of their Christmas lists. Most of the growth in retail is coming from online, and the growth in online is coming from mobile. We continue to put mobile first – and it paid off this Christmas.”
Baldock continues: “Etailers have already overtaken stores when it comes to convenience. Now AI-fuelled technology like chatbots and virtual reality has the potential to leave bricks and mortar behind in offering the best personal service. We believe it’s the next big shift in retail and financial services, and we plan to be at the vanguard.”
Which sectors fared best – and worst?
Accessories and lingerie sales grew fastest online in 2016, growing by 38% and 33% respectively. Gifts (+26%) and footwear (+21%) both exceeded the index’s average growth rate. But online sales in the health and beauty sector fell by 3%.
Bhavesh Unadkat, principal consultant in retail customer engagement design at Capgemini [IRDX VCPG], said: “2016 was a turbulent year with a number of predictions for retail and beyond going against the status quo. Regardless, it was still a record breaking year for online sales – up 16% on 2015. Few would have anticipated the decline in sales made on tablets, but with sales made through overall mobile devices generating over 50% of visits, combined with the sweeping growth of both visits and conversions from smartphones, mobile continues to head towards being the number one sales channel.
“2017 will be filled with a level of uncertainty depending on the progress and impact of Brexit, however with the investment retailers are making in improving the customer shopping experience, I am sure it will be another record breaking year for online sales.”