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UK online retail sales enjoy double digit growth in May

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UK online retail sales enjoy double digit growth in May
UK online retail sales enjoy double digit growth in May
UK online retail sales rose by an “impressive” 16% in May, according to figures out this week from etail trade association the IMRG. Meanwhile, the Office for National Statistics estimated a more conservative 10.3% growth in its latest ecommerce figures.

The ONS' Retail Sales bulletin for May found that online purchases accounted for 9.7% of retail spending during the month, with an average of £582m spent each week. Overall retail spending also saw a boost, with sales volumes up by 1.9% during the month, while the amount spent rose by 3.1% to "the highest level on record". ONS analysts added: "Feedback from retailers suggested that promotions on summer ranges led to this increase in sales."

While IMRG Capgemini eRetail Sales Index found overall sales turned in a healthy increase for the month, mobile commerce sales turned in their weakest rise since the index started recording them, growing by 148%. Average basket values continued to fall, decreasing to £77 from £83 in 2012 and £86 in 2011. At the same time conversion rates, for categories excluding travel, rose to 4.9%, a 20% increase compared to the same month in 2012 and 2011.

The figures, suggested the IMRG, appear to point to a trend of shoppers looking for bargains online and then being more likely to choose the cheaper option.


“Due to the ease with which customers can browse between retail sites in search of the right offer for them, pricing has become more competitive than ever,” said Tina Spooner, chief information officer at IMRG . “While the online retail market continues to grow at a faster-than-expected rate, customers are spending less per transaction, which impacts on the profit margins for the business. In fact, the average online basket value year-to-date is down over 10% compared with the same period in 2011. This declining trend is not likely to shoot up again quickly, as the expectation of value goes hand-in-hand with shopping online.”

Warm weather helped clothing sales, up by 16%, year on year, while home and garden spending was up by 41%.

Online-only retailers outperformed multichannel rivals, recording growth of 18% ahead of store-and-web traders’ 16% growth.

Chris Webster, VP, head of retail consulting and technology at Capgemini, said: “The online sales reflect the ongoing economic climate. Whilst there has been a slight growth in average earnings, it is still running behind the current rate of inflation of 2.4%; as a result Brits have to be savvier shoppers and embrace the savings that can be found online.

“The challenge to the high street is that once shoppers get used to the convenience of online and the ability to make their money go further, this behaviour will continue even as health is restored to the economy.”
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