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IMRG Capgemini eRetail Sales Index: Online retail fails to receive late summer bump as sales continue downward trend in August

24 Sep 2019

After online sales slumped to their lowest ever July growth last month, retailers saw little reprieve in August with growth of just +3% Year-on-Year (YoY), according to the latest IMRG Capgemini eRetail Sales Index, which tracks the online sales performance of over 200 retailers. Though typical for sales to slow at the end of summer, August’s result falls well below the 5-year average of +9.6%, as well as the 3-month, 6-month, and 12-month rolling averages (respectively +5.3%, +3.8%, +5.7%).

Looking at the results on a category level, clothing was one of the few bright spots for retailers, with sales up +9.1% against last year. Menswear had a particularly strong month, with sales hurtling up by +21.9%, while footwear sales also grew by +7.3%.

Unfortunately, the picture was not so positive for most categories. Both electricals and gifts continued their extended runs of negative growth (recording results of -22.5% and -30.3% this month), which started at the beginning of the year for electricals, and as far back as last September for gifts. Meanwhile, despite the late summer sunshine and Bank Holiday weekend BWS and home & garden were also both down by -6.9%.

Bhavesh Unadkat, principal consultant in retail customer engagement, Capgemini, said: “August was yet another disappointing month for online sales with low growth rates as we head into the peak trading period. Conversely, mobile sales have shown stronger performance over the last few months. During 2018 the pace of growth had been stalling, however, throughout 2019 there has been renewed growth, with mobile sales +14% in August versus last year, higher than the 3- and 6-month monthly averages which were +9% and +8% respectively. This is particularly noticeable in smartphones, reporting +36% growth versus last August, and showing a rise in results since the beginning of the year. Retailers are focusing more than ever on their mobile customer experience, combined with increases in app advertising and more secure payment options, demonstrating that there is still room for growth in market share by optimising the channel strategy.

Andy Mulcahy, strategy and insight director, IMRG, said: Growth for online sales in 2019 has been well below expectation this year, but there was some hope that it would balance out as 2018 was a year of two distinct halves – the first half was very strong, the second half far less so. It was as we entered the third quarter last year that growth started to fall away, so this should be the point at which growth rates edge up again as they are against lower rates from last year. That has not happened.

“It’s not universal bad news – some categories are doing quite well still, but in general retailers are having to work hard to drive sales activity; the average spend is down by around one-third, quite likely due to discounting, and the higher-spend categories of Electricals and Home & Garden are both in negative territory. It’s difficult to see anything terribly positive on the horizon as we move toward the crucial peak trading period; it could be a very tough one this year.”

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About the ‘IMRG Capgemini e-Retail Sales Index’

The IMRG Capgemini Index, which was started in April 2000, tracks ‘online sales’, which we define as ‘transactions completed fully, including payment, via interactive channels’ from any location, including in-store.

About IMRG

For over 20 years, IMRG (Interactive Media in Retail Group) has been the voice of e-retail in the UK. We are a membership community comprising businesses of all sizes – multichannel and pureplay, SME and multinational, and solution providers to industry. We support our members through a range of activities – including market tracking and insight, benchmarking and best practice sharing. Our indexes provide in-depth intelligence on online sales, mobile sales, delivery trends and over 40 additional KPIs. Our goal is to ensure our members have the information and resources they need to succeed in rapidly-evolving markets – both domestically and internationally.

About Capgemini

A global leader in consulting, technology services and digital transformation, Capgemini is at the forefront of innovation to address the entire breadth of clients’ opportunities in the evolving world of cloud, digital and platforms. Building on its strong 50-year heritage and deep industry-specific expertise, Capgemini enables organizations to realize their business ambitions through an array of services from strategy to operations. Capgemini is driven by the conviction that the business value of technology comes from and through people. It is a multicultural company of over 200,000 team members in more than 40 countries. The Group reported 2018 global revenues of EUR 13.2 billion.

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