Online sales fell 5.6 per cent in April as shoppers returned to high street retailers in their droves dealing what analysts are calling a “body blow” to the ecommerce sector.
According to the latest figures from the Office for National Statistics (ONS) retail sales jumped 9.2 per cent on March and a whopping 43 per cent compared to April 2020, the first month of trading spent in National lockdown.
While online-only retailers were hailed as the biggest winners of the pandemic, seeing sales up 56 per cent year-on-year, April saw the first major drop in online retail spend signalling that the online sales boom could soon peter out.
“As shoppers had the novelty of spending in physical rather than virtual stores, total retail sales for the amount spent and quality bought was up 10% compared to pre-pandemic February 2020 levels, showing clear pent up demand,” Hargreaves Lansdown’s senior analyst Susannah Streeter said.
“Fewer virtual baskets were filled up, with online spending dropping 5.6 per cent in April. The proportion spent online fell to 30 per cent from 34 per cent in March as real shopping trips took over from the trend of browsing in digital stores from the comfort of the sofa.”
Separate data from EY shows a similar downward trend for online retail, but suggests consumers will now demand more from both mediums.
EY UK’s retail leader Silvia Rindone explained: “The reopening of physical stores has led to a corresponding decline in online sales. But beyond the initial excitement around returning to stores, consumers will continue to shop both in-store and online and are becoming increasingly demanding over the service they receive.”
Despite the long awaited win for the high street, ParcelHero’s head of consumer research David Jinks says retailers shouldn’t rely too heavily on recovering in-store spending.
He said: “There’s no doubt that the success of Britain’s vaccination campaign has done a lot to increase public confidence. However, any retailer relying solely on increased High Street footfall must realise it’s impossible to ever land a knock-out blow to online shopping.
“Successful stores must embrace e-commerce as a key part of an integrated sales strategy. Online sales are still an enormous 31.9% higher than they were a year ago in April 2020, when Brits first began the great switch to online.
“ParcelHero’s own independent research shows 46 per cent of consumers have no intention of spending as much in stores as they used to do pre-pandemic.
“That’s backed up by April’s ONS figures, which reveal e-commerce still snatched 30 per cent of all retail sales in the UK. That’s a drop from the record peak of 36.1 per cent at the height of lockdown this February, but vastly higher than the 20 per cent of all sales that online took in February 2020 before coronavirus hit.”