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E-retail Index growth rebounds in March

E-retail Index growth rebounds in March
Thursday April 26 2012

Mobile sales record extraordinary growth as sunny start to spring helps drive e-retail sector growth

UK consumers spent £5.8 billion online in March, according to the latest IMRG Capgemini e-Retail Sales Index. This equates to a year-on-year growth of 14% for the e-retail sector and a 9% increase on February.

Mobile retailing, or m-commerce, has recorded huge growth, up a huge 254% on March 2011 and averaging 300% year-on-year growth for the first quarter (Q1) 2012.

The analysis also found the conversion rates for shoppers that visit a retail site via a mobile device and make a purchase from it remained very low however – 0.7% in Q1 2011, increasing to 1.4% in Q1 2012, compared to 4.13% in March for traditional online website visitor conversions.

The research indicated that shoppers are primarily using mobile devices to browse for goods on the move, compare prices instore or use functions such as store locators. All the mobile figures have been taken from the m-Retail Sales Index, which was launched this month and will run in parallel with the main Index.

Growth in line with forecast

The overall online market saw a 13% year-on-year growth during the first quarter of 2012, confirming earlier Index estimates for the year and a forecast the market will continue to do well in spite of the economy.

March e-commerce growth in the clothing sector saw fashion-conscious Brits update their wardrobes, resulting in of 15% year-on-year growth and a healthy 23% month-on-month increase. 

Mothering Sunday was also highlighted as another key driver in March’s strong performance. The gifts sector in particular saw the benefits of shoppers jumping online to buy presents for mum, leaping 48% year-on-year. Similarly, the health & beauty sector, which includes perfumes and other toiletries, saw a respectable increase of 19% on February.

Chris Webster, head of retail and technology at Capgemini UK, said: “It is very interesting to have the growing significance of m-commerce confirmed, and should encourage retailers to factor in mobile devices to their total retail strategy. The growth rate is important, but so too is the conversion rate, mobile customer experience must be improved to harness its potential.”

Mobile and spring weather boosts

Adam Plummer, head of e-commerce for The Body Shop and IMRG member, agreed that mobile technology held the potential to be a “game-changer”.

“The shift to becoming the primary device of choice is well under way,” commented Plummer. “As we begin to understand the desires and motivations of our customers and the technology that best serves these, we have seen our conversion rates steadily rise. While our sales growth through mobile has been phenomenal, it has been the general level of interaction that has seen exponential growth. One in five visits originate through a mobile device and, within a thriving multichannel environment, we are starting to capitalise on the way that mobile ‘glues’ all our channels seamlessly together.” 

Sean McKee, fellow trade body member and head of e-commerce and customer services at footwear retailer Schuh, added: “At Schuh we are seeing a truly dynamic performance from both smartphones and tablets, and consider all things ‘mobile’ to be fundamental to our efforts to broaden customer choice. We believe that the benchmarking and pooling of performance data is good for the industry and ultimately good for the consumer, so it is with real enthusiasm that we are participating in the m-Retail Sales index.”

Ryan Kemp, head of sales at Shopping.com, stated: “Online shopping definitely saw the effects of March’s warm spring weather and the Easter break, with barbeques sales up an impressive 56%, luggage 31%, and sunglasses 30%, month-on-month. Mother’s Day helped to drive year-on year performances for gifts and health and beauty, both up 53% and 18% respectively. Childcare items also proved strong players for Shopping.com, including buggies and strollers (up 55%) toys (21%) and baby care items (up 20%) as parents look online to help their budgets stretch further.”

Tagged as: E-retail Sales Index | e-commerce | mobile | m-commerce | retail | sales | IMRG | Capgemini | The Body Shop | Schuh | Shopping.com