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Watch industry under-performs wider UK market for ecommerce growth

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The average online basket value for the first half of 2018 reached its highest number since records began.

Overall, online retail has enjoyed a 16.8% year-on-year growth during the first half of 2018, defying extreme weather events like the Beast of the East and various heatwaves to record strong sales results every month so far, according to the Capgemini IMRG eRetail Sales Index.

This sits in stark contrast to the sustained downturn recorded on the high street so far this year (Feb-Jun).

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The first half  of 2018 (H1) e-retail has in fact seen the highest average year-on-year growth since 2011, above the 5-year-average of 14.1%. The H1 average basket value was also at its highest for the decade at £94, and again outshines the 5-year-average of £85.

Despite the UK being hit by freak cold weather moving into Spring, online retail grew by 15.3% year-on-year between January and March, with the reduced high street footfall driving shoppers to home spending. However as the weather picked up and the UK experienced some unseasonably hot weather in April, online retail sales still went from strength-to-strength, with a 18.2% growth between April and June.

Some sectors appeared to particularly benefit from the unpredictable weather, including garden, clothing and beauty.

The watch industry has under-performed in comparison, with growth evaporating in the first six months of 2018, according to GfK.

 

 

Despite the impressive growth of online retail, conversion rates for online retailers actually decreased overall every month other than May. This could be accredited to the continued trend of online shopping via smartphone devices, which are accounting for a larger share of total online sales but feature lower (albeit increasing) conversion rates. Indeed, spending via smartphone devices was up 39% against last year during Q2, although growth rates are inevitably starting to slow as this channel reaches maturity.

Andy Mulcahy, strategy and insight director at IMRG, shares: “The performance for online sales in the first half of the year has been a lot stronger than anticipated. There are a number of factors that may be influencing that – the extreme weather events (both hot and cold), the Royal Wedding, World Cup etc – and it might be possible that the feelgood elements associated with some of those events has encouraged people to spend a bit beyond their means.

“This could mean that we see a pinch on shopper spend as we move through Q3 – though the weather in July has been incredibly hot – which may lead to an imbalance in online retail growth between the first and second halves of the year.”

Tags : ecommerceGfK
Rob Corder

The author Rob Corder

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