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Online sales growth at its weakest for almost a year in June: BRC

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Online sales growth in the UK was at its weakest for almost a year in June as hot weather kept shoppers away, according to British Retail Consortium figures out today.

Non-food online sales grew by 10.6% in June, compared to the same time last year, and now make up 17.2% of all retail sales, the BRC-KPMG Online Retail Sales Monitor for the month has found.

In June 2013, online sales grew by 12.5%, and this June’s performance is the lowest online growth since July 2013, the report suggested.

David McCorquodale, head of retail at KPMG , said: “The blazing summer sun proved too much of a distraction for shoppers in June and online sales growth slowed to the lowest level seen in a year. However, the summer months are traditionally a weaker time for online sales and this slowdown will not give retailers too much cause for concern.

“The onus is on retailers to better connect with consumers online and deliver innovative, personalised campaigns which will capture the average shopper’s imagination and encourage them to spend online and in store. With a summer of sport, festivals and local events taking place across the country, there are numerous opportunities for retailers to link online campaigns with the great outdoors and regain the attention of shoppers.”

However, the proportion of retail sales made online increased. In June 2013, 15.9% of total retail sales took place over the internet, and the latest three-month average shows 16.7% of sales taking place online. The weaker growth of online is mirrored in overall UK retail sales figures also produced by the BRC today. Total retail sales for the month grew by 0.6%, compared to the same time last year, while like-for-like sales were down by 0.8%, year on year. Online sales contributed 1.4 percentage points to the growth of non-food total sales.

“Despite online growth of non-food items having increased at its lowest rate since July 2013, the proportion of online sales keeps increasing,” said Helen Dickinson, director general at the British Retail Consortium. “This is due to the enhanced online shopping experience which retailers have worked hard to provide for their customers. Retailers’ sophisticated multichannel propositions are especially convenient for shoppers who do not want to brave busy stores during the summer sale season. This means people can browse leisurely for goods online, through their mobiles, desktops or tablets, in the comfort of their own home or on the move.”

Dickinson said scale was becoming a “key differentiating factor for the online market,” as those retailers who have more advanced online services backed up with efficient distribution and logistics can offer brands from other retailers who don’t have the same scale.

Online, footwear and health and beauty were the strongest-performing categories. Across retail, food sales fell by 2% on a like-for-like basis in June, while non-food sales rose by 3.6%, perhaps reflecting the continuing price war among Britain’s supermarkets.

Commenting on the figures, Andrew Gilboy, vice president of EMEA at Demandware , said: “Summer sales and everyday discounting become the new normal during the summer months. Good weather, summer holidays and milestone events all combine to create the perfect ‘feel-good’ factor. As a result, brands are focused on deploying all the weapons in their arsenal to gain extra momentum as shoppers start to spend more freely.

“However, the main challenge remains – retailers are fiercely competing for consumers’ time and spend – so it is those brands that can deliver a convenient experience which will be the real winners. As this summer’s shoppers move fluidly between the different channels looking for their perfect product at the best price, innovating with e-receipts, in-store kiosks and click and collect initiatives will be crucial differentiators. Not only will it enable brands to engage with customers but it will help retailers to avoid losing sales at that crucial point of purchase.”

The figures come just a day after etail trade association IMRG said ecommerce sales grew by 9% in June, a similarly lacklustre growth figure for the sector. Sales between May and June fell by 5%, the steepest fall in 2008.

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