7/14/14

British shoppers avoid big-ticket items in June

Retailers in the United Kingdom experienced the steepest decline in sales between May and June since 2008.

Abby Callard , Associate Editor

Shoppers in the United Kingdom shied away from big-ticket purchases in June, according to new research from technology consultancy Capgemini and U.K. e-retail association Interactive Media in Retail Group, or IMRG. Despite that, e-commerce sales grew 14% year over year in the second quarter of 2014.

“The current uncertainty around interests has resulted in a dip in consumer confidence, and as a result, we’re still happy to buy the everyday items, but we’d prefer to hold off on those expensive treats,” says Chris Webster, vice president, head of retail consulting and technology at Capgemini.

That reluctance to spend on luxury items pulled down the month’s overall growth to 9%, which was the lowest annual growth in U.K. e-retail sales since July 2013, according to the IMRG e-Retail Sales Index. And the decline from May to June was 5%—the steepest May-to-June decline since 2008.

The travel sector also saw slow growth, increasing just 3% from the same period in 2013— its lowest annual growth since July 2013. Sales on electronics increased just 7%.

IMRG says slow sales were negatively impacted by England’s national soccer team’s early departure from the World Cup. “Football fans clearly stocked up their fridges in anticipation for the World Cup, as the beers, wines and spirits sector surged 20% year-on-year last month, and the 17% growth we saw from May to June was the steepest jump between those months we have ever seen in this sector,” says Tina Spooner, chief information officer at IMRG. “But during the week England were knocked out we saw a distinct 15% drop in alcohol sales as fans were denied the chance to raise a glass to a repeat of 1966.” England won the World Cup in 1966.

Spooner also ties the slow growth in the electronics sector to the World Cup. “Britons were not too interested in buying new technology to watch the action, whilst higher-than-average temperatures and lots of sunshine kept customers outdoors.”

Despite the slow sales, the average conversion rate went up to 4.8%—the highest rate for June since 2008. The average order value was also up in June. Consumers in the United Kingdom spent 83 pounds ($141.78) on average in June, up 5% from last year.

Topics:

Capgemini, chris webster, IMRG e-Retail Sales Index, June U.K. web sales, U.K. online alcohol sales, U.K. web sales growth, U.K. web shopping

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