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Online retail sales continue to boom despite return of brick-and-mortar stores

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Shoppers stay home, for now
Shoppers stay home, for now
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Online continues its upward trajectory despite shops re-opening, as shoppers stay home, says IMRG

Even as the high street came out of hibernation last month, June’s online retail sales spiked to a new 12-year high of +33.9% Year-on-Year (YoY).

 

Last month’s acceleration in online sales was underpinned by the continued success of almost every category, finds the latest IMRG Capgemini Online Retail Index, which tracks the online sales performance of over 200 retailers. Leading the pack, electrical sales saw the largest increase – up a staggering +99.7% YoY. Meanwhile, with pubs still closed beer, wine & spirit sales swelled to +79.9% YoY, which represents an astonishing increase of +78.8% Year-to-Date (YTD). In a further nod towards shifting consumer habits, health & beauty sales were also up +72.8% YoY – untouched by the reopening of their physical counterparts.

 

Unfortunately, demand in clothing failed to return as lockdown eased, with sales falling by -6.5% YoY. This decline was underscored by poor performances in footwear, womenswear and menswear – down -18.4%, -15.1% and -10.7% respectively.

 

Examining the retailers by type, sales in June were overwhelmingly driven by multichannel sellers. Continuing the trend from March, multichannel retailers recorded far higher growth for the fifth consecutive month over their online only counterparts, with sales up +51.7% versus +10.0%.

 

Lucy Gibbs, managing consultant - Retail Insight, Capgemini comments: “Online sales have continued to go from strength to strength in June, albeit at a slower rate than last month. Clothing, is the only sector to have remained in negative YOY results online, with footwear down -18%, womenswear down --15%, perhaps surprising as we might expect to see a resurgence in fashion due to pent up demand as restrictions ease.”

 

Gibbs adds: “The persistent increase in ecommerce will likely translate into new habits that will continue as we transition out of lockdown, however this is expected to be at lower levels than we have seen during the lockdown period. As the weeks continue, we will see if we have reached the turning point in online sales growth and which behaviours are here to stay as spending starts to revert to a ‘new normal’.”

 

Andy Mulcahy, strategy and insight director, IMRG says: “In June, growth for online retail sales was once again at a rate we’ve not seen since 2008, even with the shops open for half of it. So, initially at least, online has proven resilient to the reopening of the other main outlet for retail; the high street. However, as of 4th July, people have more options for how to spend their money, as pubs, restaurants and other leisure spaces have opened.”

 

Mulcahy concludes: “So how long will the online boom last? For some categories (such as grocery and beers, wine and spirits) it seems reasonable to assume that some of the regular demand will have shifted online for good, while for other categories the huge surges they have seen might reach natural limits and slow down. It seems remarkable to suggest that we might be seeing the gradual start of that in garden, where in the last week of June for example, growth was ‘only’ +57% - the lowest for that category since lockdown started.”

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