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Retail Technology, Retail technology News

Online shopping on track for record Christmas

Friday November 16 2012

E-Retail Sales Index reveal solid results in October as retailers prepare for pre-Christmas peak

E-Retail Sales Index reveal solid results in October as retailers prepare for pre-Christmas peak


The latest figures from the IMRG Capgemini e-Retail Sales Index have revealed solid growth in internet retail sales in October, with British shoppers spending £6.7 billion online – a 14% year-on-year growth on October 2011, and a 5% increase on the previous month.


The overall growth of the channel and in particular the huge leap in the gift sector (62% month-on-month), supports the earlier forecast from IMRG and Capgemini that Christmas 2012 will see record growth in online shopping. E-commerce is expected to hit £4.6bn over the two weeks commencing 3 and 10 December – 15% up on the same period last year, putting the Index firmly on track to meet the predicted annual growth of 14%.


Mobile growth continues unabated


Year-on-year growth in the m-commerce sector (as calculated by IMRG’s m-Retail Sales and Quarterly Benchmarking Indexes) grew by a staggering 261% in October. The increased significance of mobile devices in the British retail space was highlighted by the same Christmas forecast, which predicts that 20% of purchases made online during the peak shopping weeks, close to £1bn, will be made via mobile devices (smartphones and tablets) – a huge opportunity for retailers who have implemented mobile solutions.


The figures for October also follow the recent trend of online-only retailers exceeding multichannel retailers on year-on-year growth. October saw unabated growth for these ‘pureplays’ – the growth gap with multichannel counterparts widening to 5%.


In terms of specific sectors, October has seen steady performance across the board. Year-on-year growth in the clothing sector stood at a solid 12% and recorded an average spend of £60 – the highest in over two years.


Apple gives electricals a boost


The electrical sector saw the strongest year-on-year growth since July, a result of Apple’s iPhone 5 release at the end of September. Demand from the committed Apple fans across the UK in October fuelled the sector growth to 14%, year-on-year and month-on-month respectively.


Chris Webster, head of retail consulting and technology at Capgemini, said: “With the economy slowly improving but with a highly uncertain future, online shoppers are spending but only cautiously as they save up prior to Christmas. There is much growth to be tapped in the internet market, but knowing your target audience and matching their expectation with your offering is crucial. The explosion in m-commerce suggests that retailers are meeting this expectation and satisfying customer demand.


“Overall the outlook for e-retail is very positive and the October results, though modest in comparison with that of September, only confirms our 14% year-on-year annual growth forecast and our expectation for a successful Christmas.”


Be prepared for m-commerce Christmas


Andrew McClelland, IMRG managing director, commented: “14% is a solid result for the October Index figures, albeit just below our quarterly forecast of 15% for Q4 [the fourth quarter]. This year we really expect online sales to hit their peak in early December, when we estimate £4.6bn will be spent during the peak Christmas fortnight. The real story this year is about mobile though, as we anticipate that 20% of online sales will be made through smartphones and tablets this Christmas. The pace at which mobile sales have grown in 2012 is staggering and there are no signs it will slow up going into 2013.”


Kashif Abbas, country manager of IMRG member, commented: “October was a great month for Buyagift. All key channels achieved/exceeded their budgeted growth figures, with overall business achieving +21% year-on-year increase in sales. Online traffic to grew by +25%, which highlights an encouraging trend of customers choosing to shop online for buying gifts.


“Over 10% of our orders were placed using mobile/tablet devices and we are expecting this figure to grow as we go into the Christmas season. In the current climate customers are looking for ‘greater choice’ and ‘value for money’. With our mobile optimised platform and ever expanding product range we are well positioned to provide a better shopping experience to our customers regardless of how they choose to shop with us.”