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Ecommerce sales pick up after Christmas, with double-digit growth in January: IMRG and ONS

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Online sales growth rebounded quickly in January, following a Christmas in which sales peaked in November, new retail sales figures from the IMRG and ONS suggest.

eCommerce sales in January 2016

Today’s figures from the ONS Retail Sales report for January 2016 estimated that shoppers collectively spent an average of £863.5m a week online with UK retailers during the month. That’s 10.4% up on the same time last year, and accounted for 13% of all retail spending, excluding automotive fuel. Notably, online spending in January was estimated to be 2.7% ahead of spending in December 2015, which historically has bene the biggest month for online spending in the run up to Christmas. That may be because internet spending instead peaked early, during a Black Friday period of discounting at the end of November that is growing in popularity. ONS figures for November 2015 found ecommerce sales during that month grew by 40%, compared to the previous year.

This January , particularly fast growth came in the department store category, found the ONS, with shoppers spending 28% more online than at the same time last year, accounting for 12% of all retail sales in the category. In the household goods category, internet sales rose by 29.8% to make up 8.4% of all retail sales. Ecommerce spending in textile, clothing and food stores grew more slowly, by 8.8%, from a larger base – internet transactions accounted for 13% of all retail sales in the category.

The online growth came as ONS figures suggested shoppers spent 2.4% more on retail sales across all sales channels during the month, and 2.3% more than in December.

IMRG Capgemini e-Retail Sales Index

The latest IMRG Capgemini e-Retail Sales Index, also for January, and published earlier this week, suggested that ecommerce sales grew by 15% during the month, excluding travel sales. That’s more than double the 7% boost recorded last January and suggests, says the IMRG, that the Black Friday effect of a lingering post-Christmas slump was not repeated this year.

That, it suggests, could mean either that the Black Friday effect was a blip last year due to the surprising scale of the event, or that other factors – such as uncertainty around the election and the strength of sterling – also played their part in suppressing growth in early 2015.

“The latest index results reveal a strong start to the year for the UK online retail industry, with annual growth reaching the second-highest rate recorded over the past 14 months,” said Tina Spooner, chief information officer, IMRG , when commenting on ecommerce sales. “The 15% growth in January is more than double the growth rate observed in the same month last year, when the knock-on effect of Black Friday continued into the early part of 2015, and is ahead of IMRG and Capgemini’s 2015 growth forecast.”

The index also showed much faster growth in sales via smartphones than those made via tablet computers, continuing a trend that is seeing performance of the devices diverge significantly. Annual growth for tablets was up by just 13%, while smartphone growth was up 96%.

Spooner said: “The divergence between the use of mobile devices is becoming increasingly apparent – growth rates via smartphones surged 96% year-on-year, with confidence in using them for shopping most likely boosted by the design shift toward larger screens, together with improved retailer mobile sites. Conversely, growth in sales completed on tablet devices fell below the overall online growth rate for the first time since we started tracking it – up 13% from January last year.”

Richard Tremellen, retail insight and data specialist at Capgemini , said: “As we settle into the New Year, with the busy festive period behind us, the retail sector will be relieved to see such impressive results. It’s a strong indication that consumer confidence is continuing to grow and puts us in a good position for a strong 2016.

“The sustained growth of sales via smartphones in January also demonstrates the progress retailers have made in developing the customer experience on their mobile platforms.”

Sales of clothing and electrical items, both grew by 15% year-on-year – the highest annual growth for the electrical sector since November 2014. The travel sector enjoyed its usual peak in January, with sales up by 11% on the previous year, and 188% compared to the previous month of December.

“Dry January”

But ‘dry January’ seems to have left its mark, with sales of alcohol down by 2% compared to the previous year, and 65% compared to December. Online sales of accessories sector grew by 12% – the lowest year-on-year increase the IMRG has seen in this category, and the first time it has lagged behind the wider index.

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