Online retail sales fall at highest rate in history in June

Online retail sales fell at their highest rate in history last month despite overall spending remaining high amid fears the online boom could be coming to an end.

June saw online retail sales fall to record breaking lows dropping 14.1 per cent year-on-year throughout the month, according to the latest figures from the IMRG Capgemini Online Retail Index.

While the steep drop was partially due to tough year-on-year comparatives, having seen ecommerce growth hit a 12-year high in 2020, month-on-month comparisons were also well below pre-pandemic levels.

Compared to May ecommerce sales dipped 4.7 per cent, following similar declines in both May and April, while the June’s performance also fell well below the three-month, six-month and 12-month rolling averages of -4.54 per cent, 26.2 per cent and 35.5 per cent respectively.

“The steep fall in June of -14.1 per cent is a strong indication that consumer confidence is growing to get back out on the high-street as lockdown eases and the vaccine rollout continues,” Capgemini’s director of retail consulting Chris Long said.

READ MORE: Online retail sales fell 5.6% in April amid fears ecommerce boom could be ending

“We can expect this shift in spend between online and the high-street to continue, with retailers grappling demand swings and stock challenges across channels to ensure availability for consumers as their shopping habits change.

“Looking ahead it’s going to be interesting to see how the 19th July ‘Freedom Day’ impacts online spend, although most restrictions will be eased for the high-street there is a potential for an increase in self-isolation numbers from track & trace, which could slow the decline in online demand as many rely on home delivery.”

Despite almost all categories seeing similar declines, the easing of lockdown and Euro 2020 success helped boost both clothing and beer and wine sales by 18.6 per cent and 20.9 per cent respectively.

Average basket volumes (ABV) also maintained steady growth during the month, standing at £134 in June 2021 compared to £85 in the same period a year earlier.

IMRG’s strategy and insight director Andy Mulcahy explained: “While there was hardly any increase in ABV between 2019 and 2020, it has shot up across 2021 so far; in June 2021 it was 62% higher than June 2020.

“There are multiple possible causes, but the main one appears to be that retailers in some categories are finding they are less reliant on discounting to drive sales at the moment; with such high demand running down stock and ongoing issues around supply, shoppers are far more likely to buy an item when they see it in stock, rather than shop around for a better price. This is not true of all categories however, with beauty being a notable exception.”

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