BRC – KPMG Online Retail Sales Monitor April 2017: Easter treats put end to slide in online sales

BRC – KPMG Online Retail Sales Monitor April 2017

Online sales of non-food products in the UK grew 10.3% in April versus a year earlier, when they fell by 6.6%. This is the fastest growth since November, above the 3-month and 12-month averages of 8.2% and 9.3% respectively. This figure is positively distorted by the timing of Easter.

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Covering the four weeks 02 April – 29 April 2017

 

  • Online sales of Non-Food products in the UK grew 10.3% in April versus a year earlier, when they fell by 6.6%. This is the fastest growth since November, above the 3-month and 12-month averages of 8.2% and 9.3% respectively. This figure is positively distorted by the timing of Easter.
  • Over the 3 months to April, Online sales of Non-Food products in the UK grew 8.2% year-on-year, the highest since January. Over the same period, Total Non-Food sales in the UK grew by 0.7%, the first positive 3-month average since January.
  • In April 2017, Online sales represented 21.6% of total Non-Food sales in the UK, against 21.1% in April 2016. On a 3-month basis, penetration rate was 21.9%.
  • Over the 3 months to April, Online sales contributed 1.6 percentage points to the year-on-year growth of Total Non-Food sales. In contrast, In-Store sales made a negative 3-month contribution of 0.9 percentage points. In April, Online sales contributed 1.9 percentage points to Non-Food growth.
  • Over the 3 months to April, In-Store sales fell, posting declines of 1.3% on a total basis and 1.8% on a like-for-like basis. For the month of April, In-Store sales grew, boosted by the timing of Easter, showing their strongest growth since January 2016.

 

Helen Dickinson OBE, Chief Executive, British Retail Consortium

“April marked a reversal of the trend of slowing levels of growth for online non-food sales with the strongest annual increase since November. This pick-up was mirrored in the overall non-food figure which was distorted positively by the timing of Easter.

“Trendy consumer electronics continue to be online bestsellers, while toys and health and beauty products topped the Easter purchases.

“Online continues to account for over a fifth of total non-food sales, but as we’ve seen in previous years, the school holidays boosted family visits to physical shopping destinations over online sites, resulting in the fastest growth for stores since last January.

“Looking at the bigger picture, the twelve-month average shows a downward trend in online growth, albeit reversed in April. This points to the significance of retailers’ ongoing efforts to invest in the customer offer across all channels, as they contend with rising cost pressures and dampened consumer spend.”

 

Paul Martin, UK Head of Retail, KPMG

“For online retailers who eagerly awaited this year’s late Easter, their patience paid off. Compared to last month’s comparatively low growth, April’s non-food online sales were up by a much healthier 10.3 per cent.

“On the other hand, penetration rates in April dipped slightly to 21.6 per cent, adding to the gradual decline noted since the beginning of the year. This month’s decline is most likely the result of shoppers feeling more inclined to hit the high street, helped by the milder weather and the days getting longer.

“Easter holidays resulted in a surge of online toy sales to keep the kids entertained. Similarly, the additional free time seemingly prompted shoppers to roll up their sleeves and get stuck into home improvements, with furniture and homeware sales proving popular.

“The prominence of online retail is only set to continue, and critical to a retailer’s success will be their ability to effectively combine online and offline sales activities.”

 

-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:

Zoe Maddison
Media Relations Officer, BRC
T: +44 (0)20 7854 8924
E: Zoe.maddison@brc.org.uk  

Simon Wilson
PR Assistant Manager, KPMG
T: 0207 311 6651/ 0778 537 3397
E: simon.wilson@kpmg.co.uk

Laura Roberts 
Head of Corporate Communications, IGD
T: 01923 857141/07811 930971
E: Laura.Roberts@IGD.com

 

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

KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 13,500 partners and staff. The UK firm recorded a revenue of £2.07 billion in the year ended 30 September 2016. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 152 countries and has 189,000 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.

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