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Online retail market enjoys strong start to 2013

Thursday February 14th 2013

Online retailers enjoyed a strong start to 2013 after recording 16% year-on-year growth in January, according to figures released by IMRG and Capgemini in their latest E-Retail Sales Index.

IMRG and Capgemini are forecasting that the online retail market will grow by 12% in 2013, so have hailed the January rise as an encouraging start to the year.

The clothing sector continued to perform well following a largely disappointing 2012, with sales of seasonal ranges affected by unpredictable weather patterns. The sector was up 23% on January 2012, the highest for the sector since July 2011.

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Sales in the travel sector were up just 7% year-on-year in January, which is below the expectation of stronger growth at the start of the year when consumers traditionally begin to book their summer holidays. This compares with annual growth of 16% in January last year and 31% in January 2011. However, at the same time the average spend for the sector hit an all-time high last month of £1,085.

The Index shows that the growth of retail sales through mobile devices is showing signs of slowing, though they were still up 193%. Mobile sales in 2012 rose 304% on 2011, though in December 2012 growth slowed to 207%. 

However, conversion rates through mobile devices are rising, reaching 2.6% in January. This is the second month that the conversion rate has hit a new record, following the 2.1% recorded in December 2012.

Tina Spooner, chief information officer at IMRG, explained: "The strong finish to the year we saw in 2012 has continued into the new year it seems, with the Index up 16% on January 2012. The clothing sector struggled at times last year in comparison with its performance in previous years, but we’ve had seven months of double-digit growth now so perhaps it was a blip caused by the heavy rainfall we saw throughout 2012.

"The growth of mobile sales may be showing signs of slowing, but it is coming from a very high base and 193% is still very strong. What is apparent is that consumers are becoming more confident in purchasing through mobile devices, as the experience on mobile sites improves. The conversion rate has doubled in the space of a year, rising from 1.3% in January 2012 to 2.6% in January 2013."

Chris Webster, VP of consumer products and retail at Capgemini, added: "More of us are seeing our smart phones and tablets as the smarter choice for shopping, with the proportion of direct purchases from mobile devices doubling in the space of a year.

"Growth may be slowing as mobile shopping becomes ubiquitous, but don’t mistake this for a decline. Mobile commerce is here to stay. We’re no longer just seeing consumers shopping from their sofas at home, but instead spotting products in store and choosing to instead purchase online on the grounds of cost or convenience."