Overview
Online Retail continues to post significant Year-on-Year declines owing to the extraordinary levels of demand from 12 months ago. A more useful gauge to assess the current market performance is the Month-on-Month variance….
The total market dropped by 4.6% from May into June which is lower than the normal rate. Typically we would expect to see a Month-on-Month change between 0% to +3% at this time of year. As social occasions become more frequent and the vaccine roll out continues its high coverage, spend has likely been diverted away from online retail to other ‘in-person’ activities. Out of the 16 different product categories IMRG tracked in June, 10 of them reported a negative Month-on-Month change. Notably out of the 6 sectors that managed to increase sales between months, 3 of them belong in the clothing sector- an area largely influenced by the recent increase of social gatherings.
One of Junes few winners was the Beers, Wines and Spirits sector, reporting a +20.9% Year-on-Year uplift and an impressive +33.9% Month-on-Month increase. The European Football championships are the likely cause; Englands successful progression throughout the tournament helped boost sales, indeed during the week England faced off against Germany (week commencing 27th June) online alcohol sales soared to a +52% Year-on-Year increase.
An interesting trend is emerging for the industry average basket value- it’s been steadily increasing since January 2021. The Online Retail ABV is currently at £135, but was £91 at the start of the year. The increase could be down to a combination of factors- retailers increasing prices, money reserved for holidays abroad has been reallocated and even consumers increased comfort with high ticket items.
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