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Online sales rise 15.7% in July to £4.2 billion

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Strong clothing and electrical sales online drove a 15.7% increase in online UK sales in July 2009, compared to June, according to the IMRG Capgemini e-Retail Sales Index. Total sales reached £4.2 billion, an increase of 16.8% on July 2008.

The Clothing, Footwear and Accessories sector saw month on month growth of 18% and annual growth of 17%. “This sector has been a driving force for the Index for the last six months and consumers still appear to be splashing the cash on new summer outfits online, perhaps due to heavy discounting and promotions,” says IMRG Capgemini.

Improved conversion rates through more sophisticated targeting are the key reason for the clothing sector’s growth, say the researchers. “Clothing retailers have also seen a marked success in turning more visits to their websites into final purchases. Their online conversion rates have seen an increase to one in fifteen people for July which is up from one in seventeen in June, and higher than the average across the sectors. This could be due to the more sophisticated targeting strategies that clothing e-retailers have employed to shift summer stock to make way for autumn fashion collections. Plus consumers are now more accustomed to browsing and confident when buying clothes online.”

Accessories also saw a very strong jump in sales, up 22% on June and 73% on July 2008, whilst footwear fell 2% on June’s figures but is still up 20% on the year. Lingerie also grew, with sales up 3% on June and 14% on a year ago.

Electricals also saw strong growth, up 11% on June 2009 and 19% on a year ago, but online spending for Beers, Wines and Spirits saw an unusual sharp decline in July, down 23% on a year ago and 15% on June — the first fall in sales growth for this sector in the month of July since 2004. Gifts also fell, down 9% on June and 2% on July 2009, whilst Health & Beauty was down 5% on June and up 21% on a year ago.

“Online continues to perform strongly with year on year growth in July exceeding the last 12 months average at 16.8%,” says Mike Petevinos, head of consulting for retail for Capgemini UK. “This growth continues to be driven by the apparel and electrical sectors as retailers further improve their online propositions with better product information, visual merchandising and delivery methods.”

“It is evident that online merchants are becoming more sophisticated in their marketing efforts and email communications to their customers, the result of which can be seen in higher conversion rates, particularly in the clothing sector,” adds Tina Spooner, director of information at IMRG.

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