Online retail slumps to lowest October growth

Online retail sales have recorded their lowest year-on-year growth for October since the index launched 15 years ago, rising by just 8.9 percent in what is traditionally a peak period, according to the IMRG Capgemini e-Retail Sales Index.

The slump in growth has been linked with consumers withholding spending on products including clothing and electrical in the run-up to Black Friday, which is expected to the first 1 billion pound shopping day in UK’s retail history.

Commenting on the figures, Tina Spooner, chief information office at IMRG said: “The ‘pre-peak lag’, where shoppers hold off from making purchases in expectation of bagging a discount over the Black Friday peak, may have started far earlier than last year – as October 2015 growth was significantly down on October 2014.”

Sectors that did perform well in October were the lower average basket value items such as accessories, footwear and lingerie, with each recording an annual increase of 24 percent, 23 percent and 19 percent respectively.

While some sectors stocking higher-cost items such as electricals and garden recorded negative growth in October. Clothing sales were also impacted, though the index is stating that it was probably due to the mild weather last month.

“Given the level of discounting we saw in 2015 a slow-down in sales during the run up to Black Friday is natural,” added Alex Smith-Bingham, Capgemini’s head of digital, consumer products and Retail. “As customers are delaying their spend, particularly for the high spend items, retailers should consider how to maximise that touch point with the customer for future sales pre or post-Christmas.”

The index also revealed a significant trend in terms of a growing performance disparity between online only retailers compared to their multichannel counterparts. In October, online-only retailers saw sales increase 18 percent on the same period last year, 14 percentage points higher than that of multichannel retailers, which recorded just 4 percent.