The growth of e-tail in October is at its lowest in 15 years, according to the IMRG Capgemini e-Retail Sales Index.
The index revealed that year-on-year growth for the month of October was at its lowest since the index first began recording data in 2000, rising by just 8.9% in what is traditionally a peak period.
It is more than likely that this reduced growth is due to Black Friday, the American shopping day which has become extremely popular in the UK in recent years. It is expected to be the first £1bn shopping day ever in Britain this year, and shoppers are waiting to purchase items at a discount. Several retailers have expressed disdain over how profitable the holiday actually is, and whether it is worth the hype.
“The ‘pre-peak lag’, where shoppers hold off from making purchases in expectation of bagging a discount over the Black Friday peak, may have started far earlier than last year – as October 2015 growth was significantly down on October 2014,” said Tina Spooner, CIO at IMRG.
“Given the level of discounting we saw in 2015 a slow-down in sales during the run up to Black Friday is natural,” added Alex Smith-Bingham, Capgemini’s Head of Digital, Consumer Products and Retail. “As customers are delaying their spend, particularly for the high spend items, retailers should consider how to maximise that touch point with the customer for future sales pre or post-Christmas.”
Higher-cost products in sectors such as garden and electricals recorded negative growth in October, with the average electricals shopping basket decreasing by 12% in value compared to last year. Clothing sales were also impacted, though this was likely accentuated by last month’s mild weather.
At the other end of the spectrum, traditionally lower costing sectors performed relatively well, likely because any deals on cheap items on Black Friday are unlikely to be too impressive. Accessories, footwear and lingerie saw increases of 24%, 23% and 19% respectively: solid ecommerce growth in an unideal market.
Finally, the index highlighted a growing disparity between online-only retailers and multichannel retailers. Whilst the former enjoyed an 18% increase on the same period last year, the latter recorded a mere 4%.