The IMRG Capgemini e-Retail Sales Index reveals that British shoppers spent £4.2
billion online in October. Growth dipped significantly in the last two weeks
during the postal strikes.

After a strong start, growth fell by 2 per cent and plunged a further 5 per cent
in the space of just a week. Despite this, the Index saw both a year on year
(11.8 per cent) and month on month growth (8.4 per cent) in e-retail sales.  

Sector splits

Delivery concerns had a noticeable impact on online clothing sales, with yearly
growth of 13.2 per cent which fell short from the average of 27 per cent for the
month of October in previous years.  Many shoppers turned away from online stores
and returned to the high street to avoid delays in getting their winter wardrobe
and festive party outfits.

In contrast, the potential delivery delays had a positive effect on e-retail
sales for gifts as shoppers spent a massive 113 per cent more in October compared
to September and 40 per cent more compared to October 2008.  This is due to consumers
buying Christmas presents earlier to avoid empty Christmas stockings and gift
e-retailers also kicked off festive promotions much earlier compared to previous
years.  

Christmas shopping

IMRG and Capgemini predict that Christmas will come early for e-retailers this
year, as shoppers rush to avoid postal strikes by stocking up on presents further
in advance. 

Mike Petevinos, Head of Consulting for Retail at Capgemini UK, said: “E-retailers must ensure they heed the October warning signs and act to reassure
consumers that orders will be delivered in time for Christmas.  With consumer
confidence restored e-retailers, can get on with the real challenge of convincing
consumers to spend online and resist the temptation to wait even longer for last
minute discounting on the high street.  Ironically, careful tactical online promotions
may be the route many adopt.

Tina Spooner, Director of Information at IMRG said:

Whilst the overall Index returned to double-digit growth in October, the decline
in e-retail sales values and volumes during the second half of the month shows
that consumer confidence was affected by the Royal Mail strikes. However, with
the threat of further strike action now averted in the run up to Christmas, shoppers’
concerns around delivery will no doubt be dissipated.

It remains to be seen whether consumers will play a waiting game over the coming
weeks as they look for the best bargains online in the hope that retailers will
begin discounting as Christmas approaches.

Sector

% Change Month on Month

% Change Year on Year

Total Market

8%

12%

Clothing, Footwear and Accessories

7%

13%

-Accessories

21%

64%

– Footwear

24%

38%

Electricals

12%

12%

Beers, Wines and Spirits

10%

12%

Gifts

113%

40%

Health and Beauty

 15%

2%

Lingerie

5%

13%

Notes to Editors

About IMRG

IMRG (Interactive Media In Retail Group) is the industry body for global e-Retail.
Formed in 1990, IMRG is setting and maintaining pragmatic and robust e-Retail
Standards to enable fast-track industry growth, and facilitates its community
of members with practical help, information, tools, guidance and networking. Consumers
can be confident when dealing with IMRG Members because all have committed to
operate using methods that are Honest, Decent, Legal, Truthful and Fair, and have
undertaken to not bring the industry into disrepute. The strength of IMRG is the
collective and co-operative power of its members. 

About Capgemini

Capgemini, one of the world’s foremost providers of consulting, technology and
outsourcing services, enables its clients to transform and perform through technologies.
Capgemini provides its clients with insights and capabilities that boost their
freedom to achieve superior results through a unique way of working – the Collaborative
Business Experience – and through a global delivery model called Rightshore®,
which aims to offer the right resources in the right location at competitive cost.
Present in 36 countries, Capgemini reported 2007 global revenues of EUR 8.7 billion
and employs over 83,000 people worldwide.

More information is available at www.uk.capgemini.com.

About the ‘IMRG Capgemini e-Retail Sales Index’

The IMRG Capgemini Index tracks ‘online sales’, which we define as ‘transactions
completed fully, including payment, via interactive channels’ from any location,
including in-store.  These sales are predominantly internet-based today, but the
Index remains ready to record e-retail sales conducted via whatever interactive
channels the market may embrace in the future.

Over one hundred e-retailers now regularly contribute data to the IMRG Capgemini
Index, including Airport Parking & Hotels Ltd, Arcadia Group (Burton, Top
Man, Top Shop, Dorothy Perkins, Evans, Wallis, Miss Selfridge), Ascension Online,
ASOS.com, Beautique.com, BeCheeky.com, Binends.com, Black Essentials, Blacks,
Boden.co.uk, Boohoo.com, Boots Direct, Brora, Buyagift.com, Carphone Warehouse,
Charles Tyrwhitt,  Clarks, Cloggs, Comet, Co-operative Travel, Crocus.co.uk, Dabs.com,
Damart, Daxon, Debenhams, Dobbies, e-flowersUK.co.uk, Ethical Superstore, Figleaves.com,
Firebox, First Choice, Freemans Grattan Holdings, Furniture123, Game, Gameplay,
Gamestation, Getting Personal.co.uk, GreatValueJewellery.com, Greenfingers.com,
Home & Cook, Interflora, JD Sports, J D Williams,  Jack Wills, Jason Shankey,
John Lewis Partnership, Ladderstore.com, La Magia, La Redoute, lastminute.com,
Lighting-Direct, LK Bennett, Lookfantastic.com, M and M Direct, Made in Sheffield,
Marks & Spencer, Millets, Monster Travel, Musto, Naked Wines, NaturalCollection.com,
New Look, Next, Peacocks, Perfect Handbags, PetPlanet.co.uk, PIXmania, Prezzybox.com,
QED-UK, QVC, R C Roland, Redcats UK, Redfoot Revolution, Richer Sounds, Rubber
Sole, Scales Express, Shoe-Shop.com, Shop Direct Home Shopping, Schuh, Serenata
Flowers, Shudoo, Slurp.co.uk, SockShop, Sunshine.co.uk, Tesco.com Wine, Tesco
Electrical, The Fragrance Shop, The Health Supermarket, The Natural Store, TUI
UK, Turton Wines, Vertbaudet, Vie at Home, Waitrose, Wallace Sacks and Wilkinson
Hardware.

Quotes from retailers:

Commenting on the latest IMRG Capgemini e-Retail Sales Index, Cameron McLean,
PayPal’s General Manager for UK merchant services, said:  “Recent PayPal research revealed that 27 million people are planning to do some
or all of their Christmas shopping online this year, so we would expect to see
this seasonal spike in gift sales continue through November and into December.  Greater reliability and convenience in home delivery has been the key reason
why
nearly one in five (16%) shoppers say they have increased their online spending
and as the weather worsens it’s easy to see why people prefer to shop from the
warmth of home rather than brave the high street.

 

Christian Robinson, MD of Firebox.com comments:

Firebox saw strong sales growth in October, with significant increases over prior
months as well as year-on-year. The Royal Mail strikes did not appear to negatively
affect sales, although we swapped to City Link during the worst hit period to
ensure orders would not be delayed. With new initiatives including our Global
Secret Santa project and the first Firebox TV campaign in seven years we’re looking
forward to a busy Christmas period!

Alison Wade , head of marketing at Buyagift.com, comments:

Buyagift.com has proved yet again this October that businesses can still flourish
during potentially trying times. October’s Royal Mail strikes saw many businesses
suffer a negative impact on sales at a particularly crucial time of year on the
gifting calendar, but this wasn’t the case for the North London company.

It was essential that we didn’t lose the large sales volumes of the Q4 period
we’ve traditionally come to expect, by offering alternative options to those who
were concerned.  By holding limited period promotions such as free courier delivery
on all orders, we put peoples’ minds at rest and saw sales rise by over 18% in
October 2009 compared to 2008.”

Press contact:

Tom Barton

Capgemini UK plc

Tel.:+44 (0)870 238 2491

Email: tom.barton@capgemini.co.uk