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Despite Brexit and Trump, online sales continue to grow driven by mobile

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In spite of the continuing economic uncertainty facing the UK – particularly following the Brexit vote in June and now a Trump presidency – online retail sales have been far stronger than anticipated so far in 2016, driven in a large part by mobile according to data from IMRG and Capgemini.

Growth for online retail sales is currently running at +15.1% year-to-date (Jan-Sep) against the same period in 2015, 37.3% ahead of the original start-of-year forecast of 11%. 
With only three months of data still to come this year, the IMRG-Capgemini annual forecast for 2016 has now been revised to +15%.

And it’ all down to mobile believes Justin Opie, MD at IMRG: “The last time we recorded a declining trend in annual growth rates was between 2010 and 2012, but the emergence of tablet devices reversed that – extending the times and locations in which people could browse retail sites and making 9pm a new daily peak as people used them on the sofa in front of the TV. It may be that smartphones are now helping to provide a similar boost – sales growth for these devices has been very strong over the past year or so, up 82.8% year-to-date (Jan-Sep) while for tablets it is just 5.5%.”

The strong growth is likely to continue into the final quarter of this year, as shoppers look to make purchases before 2017 starts – due to many retailers reporting that they will hold off on increasing prices in line with rising inflation until after Christmas.

In addition, Black Friday in 2015 was notable for being largely characterised as an online event – with shops in many regions receiving lower-than-expected levels of footfall on the day as people made their purchases digitally – and this shift of purchasing behaviour to online may have extended into 2016.

In fact, since November 2015 (which featured the Black Friday period) online sales growth has remained consistently double-digit – although some of this was building on lower growth rates in 2015 generally, when six months of the year only recorded single-digit growth.

The Brexit vote also appears to have had little negative impact on online sales growth – with Q3 2016 (Jul-Sep) recording growth of +17% - which was the highest quarterly growth since Q1 2014.

Bhavesh Unadkat, Management Consultant in Retail Customer Engagement Design at Capgemini says: “There is an uncertainty that surrounds Brexit in terms of its impact, however what is pretty clear is that any impact won’t be seen in its fullest for months to come.  With this in mind it has been another stupendous year for e-retail so far, with performance up 15% on the year, proving consumer confidence remains strong. “The end of the year will be boosted further by Black Friday and peak season. Indeed, when considering the amount of planning and preparation retailers have made this year compared with last year, both without a doubt will be record breaking. The cherry on top could be the weakness of the pound as those looking for summer sun may decide to stay at home and reinvest that spend into the UK.”
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