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Online and offline sales slump as consumers less willing to spend

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Online and offline sales growth slumped in August, according to new figures from accountants BDO, which suggest that consumers were less willing to spend in stores or over the internet as they headed off on holiday instead.

But figures from eBay Advertising suggest that a lift in ecommerce sales may be in sight as nights draw in and ‘hibernation season’ arrives.

BDO’s High Street Sales Tracker found high street sales fell by 4.3% last month, compared to the same time a year ago, while non-store sales, predominantly online, grew at the relatively low rate of 11.5%, on a like-for-like basis. The figure represents a new low a month after BDO reported the largest fall yet in non-store like-for-like sales to 14.6%. Last August, non-store sales grew by 38.8% compared to the same month in the previous year, while high street sales grew by 5%.

BDO says the high street sales figure is the worst performance recorded since November 2008, and the fourth month in a row of negative like-for-like sales.

It says that retailers are suffering from the strength of the pound as consumers spend on holidays rather than retail goods. “Consumers are spending more on items abroad to take advantage of the exchange rate, whilst tourists – particularly from the Eurozone – are less willing to spend. The continuing political and macroeconomic uncertainty, coupled with the threat of an interest rate rise in mid-2016, is also weighing on consumers’ minds.”

However research from eBay Advertising, whose parent company eBay this week marked its 20th anniversary, suggests that the autumn TV season will bring plenty of opportunities to those retailers ready to cash in on ‘couch commerce’. It says that programmes such as The Great British Bake Off and Strictly Come Dancing have a demonstrable effect on eBay searches. While 12.3m viewers turned into the Great British Bake Off final last year, searches for the featured Kitchen Aid food processor rose by 36% on, and searches for measuring cups were up by 38% on the day of the pastry challenge on September 17.

Meanwhile, as Strictly Come Dancing’s first episode aired last year searches for ‘ballroom dress’ rose by 34%; during the final ‘ballroom shoes’ searches rose by 163%. Phuong Nguyen, director, eBay Advertising UK, said: “Couch commerce represents a huge opportunity for savvy brands at this time of year, but brands also face stiff competition. The real differentiator for retailers at this time of year is the ability to react in real-time to events on the small screen.

“For example, a focus on a specific style in an episode of X Factor can lead to shifts in consumer interest that, although often hugely significant, can be brief. Brands that can’t react in time risk missing out on this significant share of wallet.”

Image: © Myst

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