UK online sales exceed £100 billion in 2014

The Christmas shopping period as a whole, defined as the eight weeks between 2^nd November and 27^th December, saw UK shoppers spend £21.6bn on gifts and bargains, equating to a solid 13% growth on the same period last year. However, e-retail during December recorded just 5% year-on-year growth – the lowest ever in the Index for this period – as the discounting around Black Friday focused huge volumes of sales activity on the final week of November (w/c 23^rd November). According to separate figures from Experian and IMRG, an estimated £810m was spent online on Black Friday 2014, the biggest ever day for UK online sales. The Index figures show that the greatest concentration of sales during the Christmas period (17%) took place during the week of Black Friday.

Adgild Hop, Principal, Head of Retail Consulting, Capgemini, commented:

“2014 has been an important milestone for the online retail sector, with the £100 billion mark being exceeded for the first time. When we consider that almost £1 in every £4 is now spent online, and that a large proportion of the other £3 is influenced by some form of digital interaction, it becomes very clear that retailers need to continue to embrace the opportunity that e-Retail poses.
“Additionally, we need to be cautious about the tendency of retailers to chase sales volumes at the expense of customer intimacy and profitability. Black Friday was unquestionably a success for the value-seeking consumer, but for retailers themselves, its success is not quite as clear. As the Index reveals, spending was brought forward a month earlier, at much lower margins for retailers, as a result of the discounts available to customers in November.” 

Tina Spooner, Chief Information Officer, at IMRG said:

“While the 5% December online growth is lower than expected, the story of Christmas trading online this year is one of compression. The anticipated heavy discounting that was very widely communicated in advance of Black Friday served to concentrate the peak around that day in November.
“Looking at Christmas trading as a whole, the 13% growth for November and December combined was actually around where we would have expected. The challenge going forward is that Black Friday has been cemented into shoppers’ consciousness and they will expect the same kind of focused discounting next year. As an industry, we will need to work together to understand how this extreme activity spike can best be managed in the interests of both shoppers and retailers.”

Mobile

Sales via smartphones and tablet devices recorded a 55% growth on the same period in 2013. £8bn was spent via mobiles this Christmas, compared to £5.1bn last year. The Index reveals that 37% of online sales are made on a mobile device; an estimated 8.9% of total retail sales.

– Ends –

Industry Quotes:

Mark Lewis, Online Director at John Lewis, said:

“There is no doubt that this year highlighted a new shape of trade for the Christmas period. Black Friday was John Lewis’s biggest ever week for sales in our 150 year history.  Online sales broke records on the day itself and during the early hours of trading there was a 300% increase in traffic to johnlewis.com.   
“For Christmas overall our online sales were strong, increasing by 19% compared to last year and as we predicted, this was the year that Click & Collect really came into play with 56% of online orders being collected in shops as opposed to home delivered.
“Looking to the year ahead, we expect to see convenience remain high on the list of customer needs and in turn both online sales and Click & Collect volumes remain strong. With this comes the need for a solid back office function both in IT and Distribution and this remains a key focus throughout 2015 to ensure we meet continue to meet customer demand.”

[1] Christmas period defined as 8 weeks: w/c 2^nd November – w/c 21^st December

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. 
Over one hundred e-retailers now regularly contribute data to the IMRG Capgemini Index, including A. Hume Country Clothing, Addict, Airport Parking & Hotels Ltd, Alison at Home, Amara, Appliance House, Arcadia Group (Burton, Top Man, Top Shop, Dorothy Perkins, Evans, Wallis, Miss Selfridge), Ask Direct, ASOS.com, B&Q, Bank, Berry Bros & Rudd, Blacks, Boden.co.uk, Boohoo.com, Boots Direct, Brora, Buyagift.com, Carphone Warehouse, Charles Tyrwhitt, Clarks, Crocus.co.uk, Dabs.com, Damart, Debenhams, Deckers, Dune, Dunelm Mill, Effortless Skin, Ethical Superstore, Firebox, First Choice, Freemans Grattan Holdings (Freemans, Grattan, Look Again, Kaleidoscope, Curvissa, Swimear365, Witt International UK), Game, Get The Label, Greenfingers.com, Hobbs, Home & Cook, House of Fraser, JD Sports, J D Williams, John Lewis Partnership, Ladderstore.com, Lastminute.com, LK Bennett, M and M Direct, Majestic Wine, Marks & Spencer,  Millets, Moss Bros, Naked Wines, NaturalCollection.com, New Look, Next, Perfect Handbags Perricone MD, PetPlanet.co.uk, Pitchup.com, Prezzybox.com, QVC, Redfoot Revolution, Richer Sounds, Sainsbury’s, Scales Express, Schuh, Scotlight Direct, Scott, Shoe-Shop.com, Shop Direct Home Shopping (Kays, Littlewoods, Very, Isme, Woolworths), Serenata Flowers, Size, Sofa.com, Sofa and Home, Sparkling Strawberry, Sunshine.co.uk, SuperGA, SuperGroup, Tesco.com, The Body Shop,  The Mat Factory, , The White Company, This is Pulp, TUI UK, Turton Wines, Waitrose, Wilkinson Hardware & Wynsors World of Shoes.
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.
www.imrg.org 
About Capgemini
With more than 140,000 people in over 40 countries, Capgemini is one of the world’s foremost providers of consulting, technology and outsourcing services. The Group reported 2013 global revenues of EUR 10.1 billion. Together with its clients, Capgemini creates and delivers business and technology solutions that fit their needs and drive the results they want. A deeply multicultural organisation, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore®, its worldwide delivery model. 
 
Learn more about us at www.uk.capgemini.com.

Rightshore® is a trademark belonging to Capgemini