UK online retail sales growth doubles to 15% in Q1 2016

UK online retail posted strong double digit grow in the first quarter of 2016 with sales rising by 15% (excluding travel) year-on-year, boosted by strong online sales in March and an increase in average basket value, according to the British e-commerce association IMRG.

The 15% growth in Q1 2016 nearly doubles the 8% growth during the first quarter of 2015 which was the first time when the IMRG Capgemini e-Retail Sales Index recorded a full quarter of single-digit growth.

The average basket value (ABV) also went up from £77 in Q1 2015 to £81 during the first three months of this year, following a general decline throughout 2015.

March recorded solid online sales growth of 11% in a monthly comparison with February and the average basket value of £82, IMRG stated.

Several sectors showed a strong performance in March. The accessories sector recorded a spectacular 58% year-on-year growth – the highest increase since May 2015. With the main theme of the month for Brits being spring cleaning, the Home and Garden sector recorded a particularly strong year-on-year increase of 26% – the highest growth since February 2014. The sector also revealed an ABV of £93 – the highest since October 2012. IMRG stressed that the drive in online sales can be attributed to the strong growth of 33% in the Home sub-sector, compared to the Garden sector which saw a drop of 12% on the same period last year.

While Brits increasingly shop via mobile devices, the divergence between tablet and smartphone sales continued in March, as sales via smartphones surged ahead with a massive 101% increase year-on-year (excluding travel), compared to only 6% growth via tablets. In Q1 overall, smartphone usage grew almost nine times with 96% compared to just 11% for tablets. This can be seen as part of a wider trend in the sector.

Tina Spooner, chief information officer, IMRG, said: “Sales via smartphones continue to surge ahead, growing at 9x the rate of sales completed on tablet devices during the first quarter of the year. There is no doubt that larger screen sizes have enhanced the user experience on smartphones over recent years which is a key factor in the shift towards shopping on these devices.”

Smartphone is the fastest growing channel in the UK online retail market – conversion rates were 50% higher in Q1 than the same period last year and average online transaction values reached a record high of £85 during March. Not surprisingly, many retailers are placing a significant focus on their mobile strategy as consumers shift towards handheld devices when purchasing online,” she added.

Richard Tremellen, retail insight and data specialist, Capgemini, highlighted the double-digit growth in online sales during Q1 2016 as a highly positive sign for the sector, further strengthened by the average basket value growth. “There appears to be a sizeable shift in consumers’ confidence in online shopping.”


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