Online retail sales fell by 19.8% year-on-year during November as people did more of their shopping in bricks & mortar stores.
The data from the IMRG Capgemini Online Retail Index does compare to an exceptionally strong November in 2020 (+36.2%) when Covid restrictions were tightened. However, the month-on-month figures were equally negative – showing a rise of only 40.4% versus the +50% that would typically be expected for the October to November timeframe.
The research shows that online shoppers are both buying less often and spending less when they do, with the conversion rate down by 20% to +3.3% and average basket value (ABV) falling to £123 (versus its 2021 peak of £149). With high street sales up, it is perhaps unsurprising that of the retailer types, multichannel brands suffered the most – with their sales plummeting by 23.4% compared to a fall of only 13.4% for online-only retailers.
Meanwhile, every category bar clothing saw double-digit negative growth, with gifts in particular seeing a huge decline of 46.4%. In a month where previously Black Friday spend would be focused on electricals, that category recorded the second-lowest result, down 29.2%.
Lucy Gibbs, managing consultant – Retail Lead for Analytics & AI, Capgemini, commented: “The drop in online sales this year is not unexpected. However, the month-on-month figures suggest that spending overall has been even more subdued.
“While a return to in-person shopping has taken a large share of the spend, other factors such as supplier shortages and delivery disruption have also caused retailers to spread and dilute some of the offers, which could be behind the decrease in conversion by 20% across November.”
Andy Mulcahy, strategy and insight director at IMRG, added: “In retail, we are often prone to focusing on the negatives, but there is no escaping that November’s performance was very poor. The most concerning thing is that traffic was the problem; shoppers were just not visiting retailers’ sites in their usual volumes.
“To an extent, that could be explained by people taking to big high street locations again, but the next few weeks will be very interesting in that respect. There does seem to be an attitude of ‘getting it in before we get locked down’ at the moment, but from next week people will not want to go anywhere to avoid having to isolate over Christmas. We will, from a retail perspective, be in a lockdown in all but name, which will really skew trading figures.”
NAM Implications:
- No worries online, Boris on the case!
- Seriously, the Plan B/C moves promise to restore some of the physical retail sales restrictors…
- …and for those that can afford online, the convenience will not be surrendered easily.
- We still have a worried population out there, on many levels…
- With savvy consumers increasingly demanding demonstrable value for money…
