Black Friday and Christmas trading peaks are unlikely to save online retail sales for the year coming significantly below expectations.
IMRG predicted at the start of 2019 that the online retail market would grow nine per cent for the full year, after nine months of data this figure stands at just 4.9 per cent.
“In short, it’s difficult at this point to see how the peak trading period is going to be anything other than weak from a revenue perspective, and may potentially even be completely flat,” IMRG stated in a recent report.
Sales have failed to pick up as expected in the second half of the year, and with the exception of beauty, growth in every sector is currently tracking behind where it was at this point last year and “shopper demand seems to be very suppressed”.
For the Black Friday period (November 25 to December 2), IMRG has forecasted growth of just two-to-three per cent, the lowest forecast it has ever given.
“Given the myriad problems retail is currently experiencing, there seems a very real possibility that sales could well be flat or even negative,” the report added.
Looking ahead of Black Friday, IMRG also expects December’s sales to underperform, predicting growth of one-to-two per cent “which is even lower than it looks at first glance, as this is in comparison to the very weak growth of last year, which was the lowest for the month of December, ever.”
IMRG blames a range of issues for its dismal predictions, including the shopper confidence in the UK being dragged down by the increasing number of retailers falling into administration.
This intensely difficult period for retail has also forced many to rely on discounting, which will force them to push “harder and deeper than they would like” over the Christmas period hitting margins even more.
Of course Brexit has also been a key weight on online sales, with uncertainty “tying up investment that might otherwise have been used to improve customer experience”.