E-retail confidence helps online sales go from strength-to-strength, IMRG Capgemini Index reveals

Latest figures from the IMRG Capgemini e-Retail Sales Index have revealed despite a precipitous slowdown in high street sales in February, a result of the severe wet weather, e-retail recorded a solid performance with an 18% annual increase. Equating to an estimated £7.2bn spent online, the Index reflects the ongoing consumer confidence in the wider online retail sector, with m-retail also reporting 66% year-on-year growth.

Valentine’s Day helped boost sales in the e-retail sectors traditionally associated with romantic presents. Lingerie recorded a year-on-year increase of 24%, whilst health & beauty, which includes perfume and cosmetics, reported 25% growth on the same time last year.

February also saw strong online sales in home and garden, which may be attributed to an increasingly healthy housing market. With home owners spending on new furniture and accessories, the sector reported a 26% increase on February 2013.

Online-only/catalogue retailers recorded an annual growth of 22% in February, the strongest year-on-year growth for three years and far exceeding their multichannel counterparts, which recorded growth of just 16%.

Tina Spooner, chief information officer at IMRG, said: “Growth in the UK e-retail sector shows no sign of abating, with the Index performance coming in ahead of our expectations last month. In fact, looking at the combined results for January and February it is evident that we have seen the strongest start to the year since 2011. 

“The exceptionally wet weather during February undoubtedly helped boost online sales as shoppers shunned the high street. It is interesting to see the pureplay merchants not only outperformed the multichannel retailers in terms of year-on-year e-retail growth, but also recorded a 6% annual rise in average transaction value. Conversely, the average online order value for the multichannel merchants remained unchanged from February last year.”

Chris Webster, VP, head of retail consulting and technology at Capgemini, said: “The continued growth of e-retail demonstrates the overall strength of consumer confidence and leads one to believe the disappointing February overall figures are most likely a result of the wet weather.  Strong spending on home & garden and lingerie for Valentine’s Day also show people investing in homes and relationships further increasing the feel good factor.

“As a small aside, it is would be nice to know if the strong increase in footwear year-on-year was caused by a surge in demand for wellies and waders; unfortunately, there are some things our e-Retail Index cannot tell.”