Online retail sales hold up in February but enjoy Valentine’s Day spike, Index finds

Online retail sales in February rose 13% year-on-year, according to the IMRG Capgemini e-Retail Sales Index. This is broadly in line with researchers’ forecast for the year as a whole (12% growth).

While nearly all sectors recorded double-digit growth, the average basket values were largely down with the exception of those linked to Valentine’s Day, the Index found. The average spend for the gifts, health & beauty and lingerie sectors were up 36%, 8% and 9% respectively, while for the market as a whole the average spend was at its lowest since October 2008.

With regard to sales through mobile devices (smart phones and tablets) IMRG and Capgemini said they are seeing two potential trends emerging: a drop in growth levels and higher conversion rates.

Mobile sales in 2012 were up 304% on 2011. In February 2013 mobile sales were up 184% year-on-year, still very strong growth, but there has been a notable dip in the level of growth over the past few months, with December 2012 up 207% and January 2013 up 193%.

Over a similar period, researchers said they have seen conversion rates through mobile devices rise to a higher level and remain there consistently. During 2011 the average conversion rate via mobile devices was 1%, but one year later in November 2012 it went over the 2% barrier for the first time. It has not dropped below it since, hitting a high of 2.6% in January 2013 and coming in at 2.3% for February 2013.

Tina Spooner, chief information officer at IMRG, said: “Online retail held its own in February, following a strong start to the year in January when the market was up 16%. Valentine’s Day clearly had a positive impact for e-retail with gift sales up 26% on February last year, and the average online gift spend reaching its highest level in over two years.

“The mobile growth rate has slowed by around a third over the last three months or so compared with 2012, which is perhaps inevitable after the boom in tablet sales last year that has no doubt driven it. As the use of mobile devices as internet portals has also become widespread, it has turned mobile into a viable sales channel as evidenced by the rise in conversion rate.”

Chris Webster, VP, head of retail consulting and technology at Capgemini, said: “The slowdown in the growth of the mobile sector shouldn’t come as a surprise. As with traditional channels consumers are becoming used to using their smart phones and tablet devices to shop, but retailers must realise mobile technology alone is not the ultimate antidote for the woes being experienced on the high street. Like a computer, it is simply an extension of one’s offering, another weapon in a retailer’s armoury – when combined with other channels to make a truly connected multi-channel experience; it is a very effective tool indeed.”