Online sales robust; £4.4 billion spent in April

| Press release
Latest index shows shoppers spent £4.4 billion on goods.
  • Total online retail market up 13% on April 2009
  • Growth in online travel sector slows by 9% month on month
  • Shoppers prepare homes and gardens for summer; 32% uplift in online sales

Latest figures from the IMRG Capgemini e-Retail Sales Index shows that total sales online increased by 13% in April compared to last year, with shoppers splashing out on £4.4 billion worth of goods. The Index shows a 3% decline month on month, in line with seasonal trends for April when Mothering Sunday falls mid–late March.

The Index also reveals the full impact of the ash cloud in April on sales of tickets and travel online. As flights were cancelled and fears of the volcanic eruption’s long-lasting effects set in, consumers spent 9% less than in March. While sales increased by 5% year on year, this growth is lower than the market average.

Temperatures and hemlines rose in April as the wedding season kicked in. Sales of clothes online soared, with a 21% increase compared to last year. There was a noticeable increase in sales towards the second half of the month when the first signs of summer started peeking through the clouds.

There was also a clear rise in the Index for beers, wines & spirits in the last 3 weeks of the month as shoppers stocked up ahead of the bank holiday weekend in early May and with heavy discounts ahead of the World Cup. This coincided with rocketing sales of home and garden products, with sales rising by 32% compared to last year, and 11% compared to March ’09.




Chris Webster, Vice President, Retail Consulting and Technology, Capgemini, said: “Online retail is seeing continued high growth levels of 13% as more and more retailers are using an online channel to attract a new market and retain existing customers. The clothing sector in particular has been given a boost by April’s early signs of summer, with shoppers logging on to update their wardrobes for the new season. This sector is driving growth behind the industry as a whole.”

Tina Spooner, Director of Information at IMRG added: “We continued to see double-digit growth in the online retail sector during April, with the home and garden sector recording particularly strong growth of 32% year-on-year. The fine weather seems to have encouraged DIY enthusiasts and gardeners to get spending online, resulting in the average basket value for home and garden retailers soaring 64% compared to the same month last year.

“Conversely, growth in the travel sector slowed to just 5% in April, after recording yearly growth in double figures during February and March. This may be an early indication of the impact of the volcanic ash cloud on the travel industry”.

Sales for retailers with both an online and store presence are up 22% compared to last year, whereas those with just an online presence have seen sales increase by only 6% on the same month in 2009. In the first quarter of 2010, sales for online only retailers have been growing below the levels seen by those with a high street as well as online presence.

Industry quotes:

Bruce Fair, Managing Director of Kelkoo UK, comments:
“The recession cost the UK travel industry £3.7bn in 2009 and it looks like the sector will need to buckle its seat belt for another bumpy ride in 2010. Just as forecasts were indicating a modest financial recovery, with sales set to increase by 2.4% (£1bn) this year, the Icelandic eruption threatens to throw cinders on the travel industry’s recovery. The recent chaos has already cost the airline industry £1.3 billion worldwide. This growing bill will inevitably be passed onto unsuspecting consumers in the form of increased travel costs. Our latest research revealed that flight prices are set to rise by 5% over the next year as a direct result of the ash cloud, rising operational costs and escalating oil prices. This means consumers will be forced to pay £1.8 billion more for travel in the next 12 months, with the average cost of a flight to New York set to creep up £62 per ticket.”

Mark Astbury, General Manager for delivery service, Collect+, commented: “The promise of summer skies has led to a boom in online clothing deliveries. Volumes of deliveries and returns in this sector are always high and we’re anticipating a busy summer. Savvy consumers continue to head online to find the best bargains, and those online retailers who offer choice and flexibility at every stage of the shopping experience can expect greater brand loyalty and higher conversion rates.”

David Stratton, Head of Sales, HolidayExtras.com, added: “HolidayExtras.com has taken a hit since the volcanic ash disrupted UK air space; at the height of the chaos we were receiving cancellations at a rate of 1,000 per day. Our immediate concern was to help our customers and our partners’ customers - many of which were stranded thousands of miles away, and we believe this dedication to customer service will lead to these customers returning to book again with HolidayExtras.com and assist long-term growth.

Our reputation for making travellers’ holidays hassle-free differentiates us, and the way our team performed when our customers needed us has spread amongst the industry and consumers. We have seen an influx of travellers using our services, some having been let down elsewhere. It seems our reputation is our key to recovery.”

For further information please contact: Flora Hancox – 020 7025 6576 (flora.hancox@redconsultancy.com)

Notes to Editors

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 ExperienceTM. The Group relies on its global delivery model called Rightshore®, which aims to get the right balance of the best talent from multiple locations, working as one team to create and deliver the optimum solution for clients. Present in more than 30 countries, Capgemini reported 2009 global revenues of EUR 8.4 billion and employs 90,000 people worldwide.

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

Rightshore® is a trademark belonging to Capgemini

About the ‘IMRG Capgemini e-Retail Sales Index’

The IMRG Capgemini Index, which was started in April 2000, 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.

Over one hundred e-retailers now regularly contribute data to the IMRG Capgemini Index, including Airport Parking & Hotels Ltd, Amara, Arcadia Group (Burton, Top Man, Top Shop, Dorothy Perkins, Evans, Wallis, Miss Selfridge), Ascension (formerly Adili.com), ASOS.com, Beautique.com, BeCheeky.com, Binends.com, Black Essentials, Blacks, Boden.co.uk, Boohoo.com, Boots Direct, Brora, Buyagift.com, BuyItDirect.co.uk, Carphone Warehouse, Charles Tyrwhitt,  Clarks, Cloggs, Comet, Co-operative Travel, Crocus.co.uk, Dabs.com, Damart, Daxon, Debenhams, Dobbies, e-flowersUK.co.uk, Ethical Superstore, Faith Shoes, Figleaves.com, Firebox, First Choice, Freemans Grattan Holdings, Furniture123, Game, Gameplay, Gamestation, Getting Personal.co.uk, GreatValueJewellery.com, Greenfingers.com, Holiday Extras, Home & Cook, House of Fraser, Interflora, JD Sports, J D Williams, Jack Wills, Jason Shankey, John Lewis Partnership, Ladderstore.com, La Redoute, Lastminute.com, Lighting-Direct, LK Bennett, Lookfantastic.com, M and M Direct, Made in Sheffield, Marks & Spencer, Millets, Monster Travel, Musto, Naked Wines, NaturalCollection.com, New Look, Next, Peacocks, Perfect Handbags, PetPlanet.co.uk, PIXmania, Prezzybox.com, QED-UK, QVC, R C Roland, Redcats UK, Redfoot Revolution, Richer Sounds, Rubber Sole, Sainsbury’s, Scales Express, Shoe-Shop.com, Shop Direct Home Shopping, Schuh, Serenata Flowers, Shedstore, Shudoo, Slurp.co.uk, SockShop, Sofa and Home, Sunshine.co.uk, Tesco.com, Tesco Electrical, The Fragrance Shop, The Health Supermarket, The Natural Store, The Present Room, The White Company, TUI UK, Turton Wines, Vertbaudet, Vie at Home, Waitrose, Wallace Sacks, Wilkinson Hardware and Winedirect.co.uk.