Olympics distract shoppers from online shopping in August, Index reveals

British shoppers spent £5.8bn online in August 2012, up 11% year-on-year but down 11% on July 2012, new figures from the IMRG Capgemini eRetail Sales Index reveal. 

While a decline between July and August is typical (-6% in 2011 and -8% in 2010) due to the start of the autumn school term, the decline was particularly significant this year with the Olympics distracting regular online shoppers, said IMRG Capgemini.

Despite the disappointing performance, and in contrast to the wider retail sector, e-commerce is growing – the year to date Index has grown 13%, as per earlier forecasts for the year.

It seems the country’s determination to cheer on team GB’s heroes affected most of the sectors in August 2012, said researchers. Despite what has been a very solid year-on-year performance over the last four months, growth in the electrical sector fell to just 11% and reported a month-on-month decline of 2%. 

The sector peaked in the run up to the Olympics at the end of July when sales of high definition televisions and SLR cameras spiked as part of the nation gearing up for the games, but once the likes of Mo Farah, Jessica Ennis and Ellie Simmonds took to the stage, sales came to an abrupt slowdown, said IMRG Capgemini. 

Clothing also struggled last month. Despite the arrival of autumn-winter ranges and the late summer sales, the sector failed to draw many takers, recording growth of only 11% year-on-year and dipping 18% on July 2012 last month.

The travel sector saw an annual growth of 9% and dropped 7% month-on-month. While this decline could be attributed to the Olympics and the desire to stay at home to watch the Games, with school holidays coming to an end, this dip is quite typical for the season.

In contrast to the overall Index results, gifts and health & beauty grew 41% and 25% year on year, respectively.

M-commerce sales, shopping via mobile/handheld devices, continued to perform particularly well in August, with the m-Retail Index reporting a growth of 294% on the same time last year. As with the e-Retail Index, the conversion rate, ie the actual sales which materialised out of website surfing, improved marginally proving that shoppers were more focused in their browsing and made less ineffective visits online.

Year-on-year growth of online-only retailers continues to exceed that of multi-channel retailers, growing 15% year-on-year as compared to the 8% growth of their multi-channel counterparts. In the last three months online-only retailers have been growing by an average of 6% year-on-year more than multichannel retailers.

Chris Webster, head of retail consulting and technology, Capgemini UK, said: “It is very common for August to see a slight decline in e-retail sales, but it is interesting to see just how much an added impact the Olympics had. It will now be up to retailers to capitalise on the changing season, and make sure the correct strategy is in place as we enter the run up to Christmas.

“Mobile commerce, although slowed slightly last month, continues to grow at a healthy pace. This will be a particularly important channel for retailers this winter, as many more shoppers will be making the most of the developments in mobile technology for their Christmas shopping.”

Tina Spooner, chief information officer, IMRG, said: “While online retail sales saw a boost during July in the run up to the Olympic Games, the same cannot be said during the event itself. The 11% growth recorded in August is below the average Index performance year-to-date and is perhaps an indication that Olympic fever did not have an overall positive impact on the online retail industry.

“While sales via mobile devices also recorded lower annual growth than seen in recent months, the m-Retail Index also reveals that the average spend via mobile devices was the lowest recorded during 2012. However, sales via mobile devices have grown a staggering 320% year-to-date compared with the same period in 2011 and by the end of this year we expect m-retail to account for around 20% of online sales in the UK.”

Sector % Change in Index August 2011 – August  2012 % Change July 2012 on August 2012
Beers, Wines and Spirits 2% -2%
Clothing, Footwear and Accessories 11% -18%
 – Accessories 39% -3%
 – Footwear 11% 2%
– Lingerie -3% 4%
Travel 9% -7%
Electricals 11% -2%
Gifts 41% 5%
Health and Beauty 25% -10%
Other 12% -7%