June saw strong online UK sales but could a sunny August spell trouble?

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UK online retail sales were up strongly again during June this year, as the hot weather and the opening rounds of the World Cup in Russia spurred a 16.9% year-on-year (YoY) growth of retail sales, according to the latest IMRG Capgemini e-Retail Sales Index. Both multichannel and online only retailers performed well (+14.8% and +18.7% respectively), demonstrating a general British taste for spending this June.

It will be interesting to see what July brings as the football World Cup continued (and England fared rather better than usual) and the good weather certainly persisted. In some parts of southern England, June and July have been the driest months on record since the 1920s.

Unsurprisingly, the largest sector increase was seen in Garden in June, with a +49.9% YoY growth as the nation prepared for barbeque gatherings and basked in the hot weather. This was followed by Clothing, with the sunny weather inspiring a YoY growth of +19.3%, including a +23.9% growth for accessories and +22.7% growth for footwear. Health & Beauty and Gifts sales were slightly more subdued, with +9.9% and +10.5% YoY growth respectively.

The measures made by the IMRG always benefit from proper scrutiny when it comes to divining what sort of month marketplace sellers enjoyed, because the organisation unabashedly represents the bigger retailers who sell online. (That said, many such retailers will sell on Amazon these days so performance there is part of the mix that the IMRG measures.)

Sales growth for UK online retail has been consistently strong so far in 2018 – in spite of the fact that there are signs of a slowdown underway. The smartphone has been the main device accounting for that high growth, yet despite sales being up +34% through these devices in June, it was actually the lowest growth rate for smartphones since October 2014.
– Andy Mulcahy, strategy and insight director, IMRG

But what of August? Regardless of the heat (which may yet fall away most of the country), there are lots of interesting things to consider about August that don’t make for a straightforward prediction.

Traditionally, August has been slow for sales and a sunny August can be very quiet online. School holidays and their associated expense are often cited as causes. And don’t forget that Mr Mulcahy from IMRG says that there are other trends pointing towards a general online retail slowdown. But, all that said, smarthphones are changing the game, remain ubiquitous and clearly drove retail growth in June whilst the sun shone brightly. So let’s see. Should the ecommerce merchant prayer still be: “let it rain”?


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