Retailers operating both bricks-and-mortar and e-commerce concepts benefited more from the unexpectedly high sector growth in February than their online-only counterparts did.
Unexpectedly warm weather last month led to a revival in online retail sales, with the sector recording nearly 10% growth year-on-year – the strongest in six months.
Despite falling below the five year average of nearly 11% year-on-year for February, the growth provided some relief for online retailers after recent struggles.
According to the IMRG Capgemini eRetail Sales Index, omnichannel retailers recorded a rate of online sales growth almost three-times greater than their online-only counterparts.
Furthermore, basket values show average spend on multichannel sites were only down by 7%, while online-only retailers recorded a sharp 17% dip.
Bhavesh Unadkat, principal consultant in retail customer engagement at Capgemini, sad that February is usually a “transitional month” as spring lines take over the shopfloor and clearance continues, especially online.
“In this regard, it was interesting to see that conversion was up over 20% on the year but sales only grew by 9%.
“This performance is driven by ongoing uncertainty ahead around Brexit outcomes and looming interest rate rises, feeding customer caution.
“The result is that people keep shopping for basics, essentials and discounts in the mainstream, but stop shopping for ‘inspiration’ or at higher price points, both of which lead to a decrease in conversion.”
Andy Mulcahy, strategy and insight director at IMRG, added: “Discounting had been very widespread across retail since July 2018, owing to the difficult and unique trading environment that retailers are facing.
“Following January clearance, many either switched off discounting or at least reduced the prominence of it – and it’s the multichannel retailers that seem to have navigated the shift more successfully.
“Those with a high street presence recorded a rate of online sales growth almost three-times greater than their online-only counterparts and the basket values are also revealing; the February average spend on multichannel sites was down -7%, while for online-only retailers it fell more sharply by -17%, suggesting perhaps that they still maintained a greater reliance on discounting.”