Online shoppers spent less on clothes in September than they did at the same time last year, dragging down the overall ecommerce growth rate for the month, new figures suggest.
Across sectors, online sales grew by just 0.6% in September, compared to the same time last year, according to today’s IMRG Capgemini Online Retail Index. Ecommerce clothing sales were down by 1.2% – the first year-on-year (YOY) fall in the category recorded by IMRG for more than two years. The poorest performance was in menswear, where sales fell by 22.5% YOY. Sales of womenswear (-13.3%), footwear (-9.8%) and accessories (-9%) were also down.
Bhavesh Unadkat, principal consultant in retail customer engagement at Capgemini, said the fall in clothing sales may have been as a result of an ongoing push for sustainability and against fast fashion. The average basket value, he said, was flat at £78, while conversion rates were 2% ahead of last year. This, said Unadkat, “indicates that low demand is the driver for poor performance. Increasing pressures are hitting consumer spending, with low confidence in the political climate and the warmer weather at the start of the month both attributed by retailers as critical factors in this month’s results.”
The September figures exclude the travel sector as a result of industry events, notably the failure of Thomas Cook. Even so, they are still behind already low long-term rolling averages. Ecommerce grew by 2.3% over the last six months and by 5.3% over the last 12 months, and was well below the five year average of 10% growth.
There were some bright spots in the monthly figures. Health and beauty sales grew by +16.4%, as did sales of beers, wine and spirits (+15.3% compared to -11.4% in 2018) and home and garden (+1.2%). But that wasn’t enough to make up for the declines in fashion as well as in sectors including electricals (-15.5%) and gifts (-18.2%).
Andy Mulcahy, strategy and insight director at IMRG, said: "September was another poor month for online sales growth; January-September the index is up just +4.9% versus a start-of-year forecast of +9%. Retailers just seem to be facing so many issues at the moment, with low shopper confidence driving the need to discount and very few categories performing well. There is only one possible positive factor, which might seem slightly surprising, that could help stimulate sales growth – Brexit.
"In the six months following the June 2016 referendum result, many expected the economic impact to be negative but actually a lot of the indicators were stronger than anticipated. If the UK does leave the EU by end of October, while that brings challenges and disruption for businesses, in the short-term the average person isn’t likely to notice any immediate impact.
"Given that 2016 precedent, should Brexit happen, there might be a collective sigh of relief that the tedium of hearing about it is finally over. We could see a degree of buoyancy in spending just in time for Black Friday and Christmas, which though temporary could help get retailers through what otherwise might prove a tough peak trading period."
Unadkat added: "Retailers will now be looking ahead at how to make the most out of the peak period. With Black Friday promotional discounting on the horizon and consumers expectations set for big reductions, this may prove challenging for retailers to manage after several difficult months."