ParcelHero’s Head of Consumer Research, David Jinks MILT, looks at the recent healthy results for tech sales – but questions why some online stores are still missing out…
A recent Reuters poll revealed retail experts feared a particularly dismal outlook for June sales, with a slump of 0.3% or more forecast. Instead, the Office of National Statistics (ONS) retail sales estimates for June show sales were up an encouraging 4.3% YOY, with e-commerce sales up 8%. Flaming good figures for flaming June, considering the general gloom and doom surrounding retail currently.
If you’re up for it, June’s numbers are worth a bit more investigation, as they may give a clue to how tech sales are shaping up this summer. That overall 4.3% rise was a measurement of the value of items sold; as opposed to the quantity. But here too there was good news, the volume of items sold also rose: 3.8% against June 2018. Drilling down a little more, overall month-on-month sales were also up: 1.3% by value and 1% by volume against the previous month, May 2019.
That’s all very encouraging, but what about tech sales in particular? What can we glean about computer, tech and IT sales from the stats? ONS stats tend to list retailers of PCs, laptops etc as ‘Household Goods stores’, and these sales saw a healthy monthly rise of 2.2% by value and 1.9% against May.
But there is distinctly less good news for Britain’s beleaguered department stores. These were the only sector to show a fall in non-food stores, at -0.2% for the amount spent and -0.4% for the quantity bought – the sixth consecutive month-on-month decline. This dip is likely to reflect falling sales in some department stores’ electrical goods departments, as well as obvious areas such as clothing. Department store’s falling tech sales may be bad news for this sector, but an opportunity for local computer and IT stores who have traditionally lost sales to department stores.
There is one potential fly in the ointment amongst all these positive results. While online sales romped away with an 8% rise YOY, they actually fell back by -0.7% month-on-month. That’s an unexpected result. It may simply reflect the fact June enjoyed better weather than May and more shoppers ventured outside. But it might point to a more significant fault-line in one sector of e-commerce tech sales. Though online household stores sales actually rose – up 3.5% month-on-month – online department store sales continued to wobble, scraping just a 0.7% rise.
Online electrical goods sales highlight the fact a number of department stores have yet to successfully conquer omni-channel sales. While some stores, such as John Lewis, have successfully extended their reputation for quality and expertise to cover their online tech sales, others have found the move significantly more challenging.
Take a look at customers’ experience of buying a laptop, tablet or PC from Debenhams. When you reach this section of the site you are immediately warned ‘Please note by clicking on debenhamsplus.com you will leave your Debenhams shopping basket. Debenhams account card and gift cards are not accepted as a form of payment on debenhamsplus.com.’ That’s scarcely the seamless, integrated, retail experience consumers expect today. Leaving behind your existing basket and not being able to spend store cards is frankly the opposite of a user-friendly experience. That’s because, in reality, shoppers have left the Debenhams site entirely. Instead they arrive at what is effectively a ‘white label’ site belonging to Buy it Direct.
Buy it Direct is a specialist retailer of a wide range of electrical goods, IT equipment, and kitchen appliances. The site join feels clunky and, because the entire supply chain behind the operation is independent of Debenhams, several purchasing and delivery options are entirely different.
It’s good that sales picked up in June, but that little month-on-month online sales stutter is a warning that no sector – not even seemingly invincible e-commerce – is out of the woods yet. And some brands can do more to help themselves present a clearer offering to the public.
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