eRetail sales up 11% on Nov 2010 lower than forecast but building on strong growth from last year
The economic crisis continues to impact upon consumer confidence but the Index was up 11% on November 2010, just below IMRG and Capgemini’s forecast of 12-14% growth for Q4.
£7.1bn was spent online in November, the first time the £7bn mark has been exceeded in a single month. However, the clothing sector recorded its lowest growth in two years and the travel sector was down 20% year-on-year.
It is worth noting that the early snowfall in November last year most likely boosted early online sales, as people unable to access the high street shopped online instead. Consumers this year may feel more confident in receiving their deliveries on time if they order in December.
This dip in online sales growth mirrors wider retail trends. According to the British Retail Consortium, November saw the high-street suffer its biggest annual fall in sales since May this year. In the wake of the ongoing uncertainty surrounding the economy, it would appear that British shoppers are exercising greater caution in their purchasing decisions online as well as on the high street.
Tthere was positive news in some sectors. The electrical sector, which has performed badly throughout 2011, has seen an unexpected return to form, reporting growth of 14% YOY, and an impressive 47% MOM. Health and beauty also enjoyed a solid month, jumping 30% YOY and increasing a significant 63% on October. Both these sectors see a spike during the run up to Christmas, as savvy shoppers jump online to purchase popular electrical devices and cosmetics/perfumes for presents.
Chris Webster, head of retail consulting and technology at Capgemini said,“While these lower than expected growth figures show that online is not immune to the economic slowdown, the shift from the high-street to online continues. A growth of just 11% is very disappointing for this time of year as traditionally shoppers start their Christmas shopping early to spread the cost of presents over several pay cheques. This does follow a particularly busy November last year, but nevertheless it is clearly a sign of consumers tightening their belts.”
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