The impending Black Friday sales have put the brakes on online sales growth in the UK. With consumers set to spend record amounts this week, growth in the online retail market took a slight hit in October. The year-on-year growth rate over the last three months has been up between 14 and 15 per cent, however that figure fell to 12.6 per cent for the month of March.
On a more positive note, the average basket value for October was at a nine year high of £94, according to IMRG Capgemini e-Retail Sales Index. Bhavesh Unadkat, principal consultant in retail customer engagement, Capgemini: “October was a bleak month for retail. You would have expected ecommerce to benefit from a more price sensitive customer, yet the interest rate hike, the bad weather and anticipation of Black Friday did little to help the cause – covering up October’s truly underwhelming performance if anything. These coming three months, October through to December, will be important to view performance as a whole and be indicative of whether people are waiting longer before they spend on Christmas. Black Friday and the Autumn Budget are both important factors in this, so hopefully we will see Philip Hammond outlining some form of catalyst to boost consumer confidence this November.”
Further evidence of this lull could be seen in the average conversion rate (the percentage of site visitors that complete a purchase) for October, which stood at 4.4 per cent. Fewer people converting on retail websites strongly suggests a more research-led focus in the lead-up to the year’s biggest discounting event.
Justin Opie, managing director, IMRG added: “October was a very average month in the context of 2017, with growth of 12.6 per cent exactly in line with the Jan-Oct year-to-date rate. As the fall in conversion rate suggests, shoppers have been well trained to expect the best deals to be available during the Black Friday period, so we can anticipate that November will convert a degree of that early research into sales – last year, the conversion rate was 5.1 per cent in November, while it was just 4 per cent in October.
"It was surprising to see electricals break its six-month pattern of negative growth in October – with Black Friday looming very large in the public consciousness, we may have expected that trend of decline to continue as shoppers held off on any major purchases, anticipating a much lower price at the end of November. The release of a must-have item like the new iPhone model could have influenced behaviour, but it’s likely that the wide availability of discounting last month was also determining.”