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The latest figures from the IMRG Capgemini e-Retail Sales Index reveal that online spending is still at a record high, despite reports of falling consumer confidence and the tightening of debt markets.  IMRG and Capgemini have discovered that UK consumers spent £13 billion in the first quarter of 2008 – an equivalent of £213^[1]  for every person in the UK.  Shoppers spent over 50% more than the first quarter of 2007.

UK shoppers do not appear to be curbing their spending online as they are now spending a third more per online visit (£12) compared to five years ago.  In addition, nearly £850 million was spent online in the week of the Easter holidays, according to the Index.

Of the sectors that are broken out, the beers, wines and spirits sector saw a phenomenal surge in online sales in February and March – an increase of 60%. According to the Index, this online sector is worth more than £700 million per annum.  Online sales for clothing, footwear and accessories have also fuelled growth – people spent nearly a quarter (21.8%) more in March compared to February. In contrast, electricals have only seen a small level of growth online for the first quarter of 2008.

Anthoula Madden, Vice President at Capgemini UK’s Consumer Products and Retail Team said: “The poor Easter weather appears to have paid off for online retailers as more people seem to have spent more time inside, shopping online in March.  Interestingly, people in the UK don’t appear to be curbing their drinking as the online beer, wines and spirits sector saw a huge increase in sales of more than 25% in the first week of March alone.  The looming budget may have spurred people on to stock up on alcohol before the increase in taxes. 

Adding to this, we have seen poor trading results for pubs in light of the bad weather and perhaps more smokers are drinking at home.  The latest figures from the IMRG Capgemini e-Retail Sales Index show that the future is not all ‘doom and gloom’ for retailers – yet it underlines that online is an essential channel for retailers to survive in such unstable conditions.”

Jo Evans, MD of IMRG, commented: “When the going gets tough, shoppers go online. We have seen this before during every downturn since the Index began, so can confidently predict that e-retail will buck the high street’s flatline trend and continue to grow strongly during the year ahead. Consumers are being extra careful with their money, so retailers are responding with highly competitive offers that the transparency of the online marketplace makes it easy for people to find. However bad the macro market conditions become, people still need to buy stuff, and smart retailers will continue to thrive online by squeezing more and more efficiency out of the channel.”

Notes to Editors

Quotes from retailers:

Mark Newton-Jones, Group Chief Executive of Littlewoods Shop Direct Group, said:

“Our online sales for Littlewoods Shop Direct Group in March were up 37%, with our lead brand, Littlewoods Direct, up 83% year on year.  Forty percent of our sales in the month were taken online.”

David Walmsley, Head of Web Selling, John Lewis Direct, said:

“Trade through March has remained strong for John Lewis Direct despite tougher trading conditions in the market at large. We have experienced especially strong sales across electricals and consumer electronics, with products such as Sony Bravia televisions and John Lewis’ own-brand washing machines being best sellers for us.”

Bruce Fair, MD of Kelkoo UK, said of the latest IMRG report:

“On Kelkoo we’ve seen user searches grow significantly year on year with Sport & Fitness, Entertainment and Home & Technology exploding in online popularity. Even though it was an early and wet Easter, searches for gardening equipment rose significantly and we’ve even seen a 39% rise in searches for holidays in the UK as we look ahead to the summer.

Technology and gaming sales are still flourishing with the Nintendo WiiFit the most searched for game as well as massive anticipation for Grand Theft Auto IV which launches later this month. The Nintendo Wii itself is still outstripping demand and we have had to work hard to ensure that we always list 5-6 retailers who list the console for £179.98.

Over the last six months, we’ve seen that online shoppers are wising up to the security issues of online shopping - around 40% of Kelkoo customers are choosing to shop with retailers who are accredited by the IMRG ISIS security standard. People are also becoming more demanding with the delivery services retailers are offering. This is being addressed by the recent IMRG IDIS delivery accreditation initiative, which assures shoppers that the retailers they choose offer reliable, simple and clear delivery services. Kelkoo has embraced IDIS and pioneered its inclusion within listings for qualifying merchants.”

Alison Wade, Partnerships Manager of Buyagift Ltd, said:

“Our website sales fell in-line with our expectations in March. We saw a slow-down of year-on-year growth from around 40% in February to 23% in March. This we were expecting as most Mother’s Day sales occurred at the end of February and not in March as they did in 2007.   We are very happy with our year on year growth of 23% on 2007.” 

About IMRG

IMRG (Interactive Media In Retail Group) is the industry body for global e-Retail. Formed in 1990, IMRG is setting and maintaining pragmatic and robust e-Retail Standards to enable fast-track industry growth, and facilitates its community of members with practical help, information, tools, guidance and networking. Consumers can be confident when dealing with IMRG Members because all have committed to operate using methods that are Honest, Decent, Legal, Truthful and Fair, and have undertaken to not bring the industry into disrepute. The strength of IMRG is the collective and co-operative power of its members.

About Capgemini

Capgemini, one of the world’s foremost providers of consulting, technology and outsourcing services, enables its clients to transform and perform through technologies. Capgemini provides its clients with insights and capabilities that boost their freedom to achieve superior results through a unique way of working - the Collaborative Business Experience - and through a global delivery model called Rightshore®, which aims to offer the right resources in the right location at competitive cost. Present in 36 countries, Capgemini reported 2007 global revenues of EUR 8.7 billion and employs over 83,000 people worldwide.

More information is available at www.uk.capgemini.com.

About the ‘IMRG Capgemini e-Retail Sales Index’

The IMRG Capgemini Index tracks ‘online sales’, which we define as ‘transactions completed fully, including payment, via interactive channels’ from any location, including in-store.  These sales are predominantly internet-based today, but the Index remains ready to record e-Retail sales conducted via whatever interactive channels the market may embrace in the future.

Approximately 60 e-retailers regularly contribute data to the IMRG Capgemini Index, including;

Airport Parking & Hotels Ltd, Ancestral Collections, Arcadia Group, ASOS.com, Avon Cosmetics, BeCheeky.com, Berry Bros. & Rudd, Boden.co.uk, Boots Direct, Buyagift.com, Carphone Warehouse, Cloggs, Comet, Co-operative Group (CWS), Co-operative Travel, Comet, Crocus.co.uk, dabs.com, Daxon, Debenhams, e-flowersUK.co.uk, EmpireDirect, Figleaves.com, Firebox, Furniture123, Game.net, GreatValueJewellery.com, Greenfingers.com, Interflora, I Want One of Those, J D Williams, Jason Shankey, John Lewis Department Stores, La Redoute, lastminute.com, Littlewoods Retail, Lookfantastic.com, Made in Sheffield, Marks & Spencer, Mothercare, Next, Otto UK (Freemans, Grattan, Kaleidoscope), PetPlanet.co.uk, Pixmania, Prezzybox.com, QED-UK, QVC, R C Roland, Redcats UK, Shoe-Shop.com, Shop Direct Group, Skinstore.com, Tesco.com Wine, Tesco Electrical, The Sunday Times Wine Club, TUI UK, United Co-op, Vertbaudet, Waitrose, Widget  

[1] Based on overall spend from the IMRG Capgemini e-Retail Sales Index’ divided by UK population according to CIA World Factbook - https://www.cia.gov/library/publications /the-world-factbook/print/uk.html