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Saturday 30 May 2020

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Online penetration reaches all-time high

Written by Peter Walker
04/12/18

The online penetration rate has increased from 32.6 per cent last year to 33.8 per cent in November 2018 – an all-time high, according to British Retail Consortium (BRC) and KPMG data.

However, online sales of non-food products only grew 2.9 per cent in November, the lowest growth on record, against a growth of 6.5 per cent in November 2017. This is below the three-month and 12-month averages of 5.3 and 7.1 per cent respectively.

On a total basis, sales increased 0.5 per cent in November, against an increase of 1.5 per cent in November 2017. This is the lowest growth since April and below the three-month and 12-month averages of 0.8 and 1.3 per cent respectively.

Last month, UK retail sales decreased by 0.5 per cent on a year-on-year, like-for-like basis.

Over the three months to November, in-store sales of non-food items declined 1.9 per cent on a total basis and 3.3 per cent on a like-for-like basis. This is above the 12-month total average decline of 2.3 per cent.

BRC chief executive Helen Dickinson said that this month cemented Black Friday as an increasingly digital event, with a record one-in-every-three-pounds of non-food purchases made online during the month.

“Weak consumer demand and falling confidence mean that retailers are in for a nerve-wracking run up to Christmas,” she stated. “Conditions in the industry have been particularly tough since the vote to leave the EU in 2016 and the current uncertainty has only compounded the challenges.”

Sue Richardson, retail director at KPMG, explained that aggressive promotional activity around Black Friday failed to lure shoppers, with like-for-like sales in November actually down 0.5 per cent on last year.

“Demand for the latest tech - whether that be driven by deals or new releases - did provide some relief from this bleak picture in which even grocery sales were fairly stagnant as food price inflation eased.

“As we’ve come to expect, online sales did fare better but when compared to the previous year’s growth, the performance wasn’t stellar,” she added.



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