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Online sales fall for the 17th month in a row in August

20 Sep 2022
  • UK online retail sales were down -4.1% Year-on-Year (YoY) in August, reversing the positive progress seen in July
  • Though below the 3-month average (-2.3%), this result is still ahead of those for 6- (-9.3%) and 12-months (-17.8%)
  • Month-on-Month (MoM) growth was down -6.2% against July, where a decline of -2% is more typical for this time of year
  • Year-to-Date (YTD) sales are down -14% with no sign of respite given the financial pressures on the remainder of the year

London UK – 20th September 2022: After July’s figures signalled a possible reversal of fortunes (dipping only -2.3%), online retail sales growth declined -4.1% Year-on-Year (YoY) in August 2022, marking the 17th month in a row of negative growth since May 2021. That’s according to the latest IMRG Capgemini Online Retail Index, which tracks online sales for 200 retailers. Month-on-Month (MoM) sales were down -6.2% against July, markedly lower than the -2% recorded in 2019, which was the last year unaffected by pandemic skews.

While August featured some of the hottest days this year, it would be expected that some categories, specifically garden and beer, wines & spirits, might experience an uplift. However, clothing was the only category to show positive YoY growth (+2.8%), while garden (-24.5%), and beers, wines & spirits (-20.6%) actually saw the sharpest declines.

Looking at these results in more detail, July 2022 saw England win the UEFA Women’s Euro 2022. For that month, clothing (11.9%) and womenswear (20%) in particular, recorded their highest positive growth in the last 12 months. August’s steep decline to low single figure growth for these categories (+2.8% and +7.6% respectively), suggests that the football could well have been a contributing factor to their positive performance.

Taking a look at the Year-to-Date (YTD) performance, online retail sales have recorded -14% negative growth since January. With plenty of categories falling behind on online sales growth expectations, the rest of the year is looking fairly bleak given the financial pressures people are under, with retailers concerned about trade over the peak period.

Andy Mulcahy, Strategy and Insight Director, IMRG: It’s been a difficult summer for online retail, with many retailers apprehensive about how performance is going to be over peak trading. The hope is that the energy cap announcement will do something to boost shopper confidence a bit before we get into November, but even then, the omens are not good. Usually, the amount of money spent online increases and decreases interchangeably in line with activity retailers are undertaking, but across July and August we recorded five weeks of decline, which is rare; there will need to be a great deal of sales growth to make up for Black Friday and peak to be positive.”

Simon Binge, Commerce Senior Manager, Customer Transformation at Capgemini: As we come to the end of a largely disappointing summer from a growth perspective, the focus turns to a critical peak trading period. While the prospect of promotional activity around Black Friday, the FIFA World Cup and Christmas should tempt shoppers to part with their hard-earned cash, retailers will continue to struggle with balancing rising costs and enticing discounts. We can see from Q2 that retailers are already being cautious with promotions, with only 33% of sales being generated by promotional activity or discounted price, vs 42% during the same period last year. With this in mind, retailers will need to explore other opportunities for increasing orders and basket value outside of deep discounts.”

About the ‘IMRG Capgemini Online Retail Index’

The IMRG Capgemini Online Retail 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.

About IMRG

For over 20 years, IMRG (Interactive Media in Retail Group) has been the voice of online 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 indices provide in-depth intelligence on online sales, mobile sales, delivery trends and over 80 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

Capgemini is a global leader in partnering with companies to transform and manage their business by harnessing the power of technology. The Group is guided everyday by its purpose of unleashing human energy through technology for an inclusive and sustainable future. It is a responsible and diverse organisation of over 350,000 team members in more than 50 countries. With its strong 55-year heritage and deep industry expertise, Capgemini is trusted by its clients to address the entire breadth of their business needs, from strategy and design to operations, fuelled by the fast evolving and innovative world of cloud, data, AI, connectivity, software, digital engineering and platforms. The Group reported in 2021 global revenues of €18 billion.

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