BRC – KPMG Online Retail Sales Monitor November 2016

BRC – KPMG Online Retail Sales Monitor November 2016

Black friday drives record online penetration.

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Covering the four weeks 30 October – 26 November 2016

  • Online sales of Non-Food products in the UK grew 10.9% in November versus a year earlier, when they had increased by 11.8%. This is the third consecutive month of growth above 10%. November’s growth was above the 3-month average of 10.7% and just ahead of the 12-month average of 10.8%.
  • Over the 3 months to November, Online sales of Non-Food products in the UK grew 10.7% year-on-year. Over the same period, Total Non-Food sales in the UK grew 1.7%.
  • In November 2016, Online sales represented 27.6% of total Non-Food sales in the UK, against 25.3% in November 2015. This is the highest Non-Food penetration rate on record, and the eleventh consecutive month that the rate has remained above 20%.
  • Over the 3 months to November, Online sales contributed 2.8 percentage points to the year-on-year growth of Total Non-Food sales, while In-Store sales made a negative contribution of 1.1 percentage points (rounded). In November, Online sales contributed 3.7 percentage points.
  • Over the 3 months to November, In-Store sales fell, posting declines of 0.8% on a total basis and 1.1% on a like-for-like basis. For the month of November, In-Store sales showed a decline

 

Helen Dickinson OBE, Chief Executive | British Retail Consortium

“November was the third consecutive month of double- digit growth for online sales. The Black Friday sales period had managed to secure significant growth last year, making November a tough comparison. So this month’s figure of 10.9 per cent, slightly ahead of the long-term trend of 10.8 per cent, is positive.

“With discounts on electricals being the key feature of Black Friday sales, it is unsurprisingly that the other non- food category, in which consumer electronics sit, contributed the most to growth in November. It was the beauty and toy categories which topped the growth rankings, as customers took advantage of the pre-Christmas discounts for gift purchases.

“With more than 1 in 4 pounds spent online, this was a record high for online non-food sales. Facilitated by the convenience of buying online, heavy sales periods, such as November, encourage an increasingly value- driven customer to shop around for price comparisons to fulfil their Christmas shopping list.”

Paul Martin, UK Head of Retail | KPMG

“There was an increased preference for shopping online this November, undoubtedly the result of the Black Friday shopping bonanza that has grown in popularity in the UK. Online sales grew by 10.9 per cent on last year and penetration rates for the month rose to a staggering 27.6 per cent. Shoppers were clearly happy to forgo the high street whilst hunting for bargains online.
“All categories performed well, however toys and baby equipment were at the top of the list for shoppers. Well timed e-Promotions, as well as eager Christmas shoppers, were likely to have been the main contributors to the rise.
“Health and beauty products continued to remain popular. In the midst of the overpowering scent of the discounts galore, the category stood out.

“Retailers now face the challenge of processing the inevitable returns following the surge in sales, all too easily overlooked amidst the excitement of Black Friday. The pressure then turns to ensuring deliveries will make it under the Christmas tree in time."

- ENDS -

Notes to editors:

The BRC-KPMG Retail Sales Monitor measures changes in the actual value (including VAT) of retail sales, excluding automotive fuel. The Monitor measures the value of spending and hence does not adjust for price or VAT changes. If prices are rising, sales volumes will increase by less than sales values. In times of price deflation, sales volumes will increase by more than sales values.

Retailers report the value of their sales for the current period and the equivalent period a year ago. These figures are reported both in total and on a ‘like-for-like’ basis.

Total sales growth is the percentage change in the value of all sales compared to the same period a year earlier. The total sales measure is used to assess market level trends in retail sales. It is a guide to the growth of the whole retail industry, or how much consumers in total are spending in retail – retail spending represents approximately one-third of consumer spending. It is this measure that is often used by economists. Many retailers include distance sales as a component of total sales.

‘Like-for-like’ sales growth (LFL) is the percentage change in the value of comparable sales compared to the same period a year earlier. It excludes any spending in stores that opened or closed in the intervening year, thus stripping out the effect on sales of changes in floorspace. Many retailers include distance sales as a component of like-for-like comparable sales.
The like-for-like measure is often used by retailers, the city and analysts to assess the performance of individual companies, retail sectors and the industry overall, without the distorting effect of changes in floorspace.

Online (including mail order and phone) sales of non-food are transactions which take place over the internet, or via mail order or phone. Online sales growth is the percentage change in the value of online sales compared to those in the same period a year earlier. It is a guide to the growth of sales made by these non-store channels. It should be noted that online sales are still a small proportion of total UK retail sales. Estimates based on ONS figures show about 10 per cent of total UK retail sales (food and non-food) are achieved via the internet.

The responses provided by retailers within each sales category are weighted (based on weightings derived from the ONS Family Spending survey) to reflect the contribution of each category to total retail sales, thus making it representative of UK retail sales as a whole. Because the figures compare sales this month with the comparable period last year, a seasonal adjustment is not made. However, changes in the timing of Bank Holidays and Easter can create distortions, which should be considered in the interpretation of the data.

As well as receiving sales value direct from the retailers in the scheme the BRC-KPMG Retail Sales Monitor also receives food and drink sales value data from the IGD’s Market Track Scheme.

In its role as sponsor of the BRC-KPMG Retail Sales Monitor, KPMG is responsible for the aggregation of the retail sales data provided by the retailers on a weekly basis. This data consists of the relevant current week’s sales data and comparative sales figures for the same period in the prior year. The aggregation has been performed by KPMG on data for periods following 2 April 2000 and equivalent prior periods. The accuracy of the data is entirely the responsibility of the retailers providing it. The sponsorship role has been performed by KPMG since 10 April 2000 and the same for the aggregation of comparative sales figures for the period from 2 April 2000 it is not responsible for the aggregation of any data included in this Monitor relating to any period prior to 2 April 2000.

The commentary from KPMG is intended to be of general interest to readers but is not advice or a recommendation and should not be relied upon without first taking professional advice. Anyone choosing to rely on it does so at his or her own risk. To the fullest extent permitted by law, KPMG will accept no responsibility or liability in connection with its sponsorship of the Monitor and its aggregation work to any party other than the BRC.

 

For media enquiries, please contact:

British Retail Consortium

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T: 020 7854 8900W

www.brc.org.uk

Zoe Maddison

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KPMG

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T: 020 7311 1000

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Simon Wilson

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M: 07785 373 397

E: simon.wilson@kpmg.co.uk

The data is collected and collated for the BRC by KPMG.

BRC

The British Retail Consortium (BRC) is the UK’s leading retail trade association. It represents the full range of retailers, large and small, multiples and independents, food and non-food, online and store based.

KPMG

Sponsored and administered by KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 12,000 partners and staff. The UK firm recorded a revenue of £1.96 billion in the year ended September 2015. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 155 countries and has 174,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

Food data supplied by IGD makes a difference by providing international market intelligence, supply chain best practice and consumer insight to the food and grocery industry worldwide. We work with consumers, companies and individuals across the chain to provide authoritative information, insight, thought leadership and leading edge best practice to help companies grow their business and develop their people.

Detailed weekly data by category is available to retailers who contribute to the monitor:

If you would like to participate in the Retail Sales Monitor, please contact:

Anne Alexandre

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E: anne.alexandre@brc.org.uk

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