If you've watched the news, picked up a paper or have had any contact with any human beings whatsoever you might have noticed that February was a little bit on the nippy side. The Beast From The East sent temperatures plummeting and, perhaps unsurprisingly, online shopping saw a big bump.
UK online retail sales were up 13.1 per cent year-on-year in February, according to the latest figures from the IMRG Capgemini e-Retail Sales Index. The cold weather saw shoppers turn online in their droves, driving a 3.5 per cent lift in sales compared to the previous week. This continues 2018’s positive start, with overall year-on-year growth averaging 13.5 per cent year-to-date.
While the sales figures were higher, the overall market conversion rate was actually down from 4.6 per cent last year to 4.2 per cent. The conversion rates for both multichannel and online retailers also came in lower than February 2017. However, the average basket value (ABV) rose by £11 in comparison to last February. Meanwhile, smartphone growth remained strong at 38.5 per cent on last year, but is certainly slowing when compared to the 57 per cent growth of last year. Tablets, on the other hand, continued their now 4-month long decline trend, decreasing 6.7 per cent year-on-year, a record low for this device type.
Bhavesh Unadkat, principal consultant in retail customer engagement at Capgemini said: “February’s sales patterns clearly demonstrate the power of extreme weather on shopping habits; as people avoid the high street in favour of cosier shopping from their well-heated living rooms.
"As the snowy weather continued well into March we anticipate a continuation of this trend in next month’s results. We’d also draw attention to the performance of the US retail market, which has just reported its third consecutive month of falling sales. As the US market is often seen as ahead of the UK’s this could foreshadow a similar trend in the coming months. Fortunately for internet retailers, the US reported 1 per cent online sales growth.”
Justin Opie, managing director, IMRG added: “Over the course of many years, the overall conversion rate for online retailers crept up very slowly but this has stalled recently and has now actually been in decline for three consecutive months. This suggests that shoppers are spending more time browsing, potentially across a greater range of sites, before making a final purchase decision and that may well be true, but a clear influencing factor is a shift in the devices people are using for shopping.
"In Q4, 32 per cent of online retail purchases were completed on smartphones (the rest were through desktops and tablets) – these devices tend to have lower conversion rates due to a variety of reasons, particularly how much more susceptible users are to being distracted when using them.”
This news ties into recent reports that, on the flip side, the adverse whether is having a hugely detrimental effect on the High Street.
Phil Dorrell, managing partner of consultants retail remedy, said: “It will be bad for the high street. Anything that takes footfall away from shops reduces spend, and pushes spend towards the internet. In the short term, it’s very much a disaster. If you go down to the nearest road you will see that traffic is significantly less than it was previously, so most parts of retail will be hurting at this point.”
With two more spells of arctic temperatures expected in the coming weeks, the High Street is set to take even more of a battering.