Online sales growth hits 13-year high

Last year saw a huge surge in ecommerce as consumers sought Covid-safe ways to shop, with total online retail sales increasing 36% compared to 2019.

This figure signals the highest online sales growth in 13 years, reports Retail Gazette – an encouraging takeaway from a year beset by lockdowns and consumer restrictions.

The data, taken from the IMRG Capgemini Retail Index, also revealed that online retail sales in December rose by 37% year on year.

Considering predictions made earlier in the year put online retail growth at 7.8% and forecast a dismal Christmas trading period, many retailers found reasons to celebrate.

With Christmas sales starting early, online shopping managed to hold onto some of the momentum it had gained during Q4, and sales rose by nearly 38% between October and December.

Looking at the online sales data for December in more depth, electricals (up 116% year on year) and gardening items (165% increase) were particularly strong.

IMRG data also highlighted that multichannel retailers performed “significantly better” than their online-only counterparts. In December 2020, this spending trend was seen in growth figures of 57% (multichannel retailers) and 9.1% (pure plays).

Speaking about these findings, Lucy Gibbs, managing consultant for retail insight at Capgemini said: “Retail in 2020 has been fundamentally shaped by the pandemic, which caused disruption to consumer demand norms and a shift in focus to digital channels.”

But the more responsive retailers are, the greater the rewards. As Gibbs continued: “Smaller retailers outperform[ed] the larger ones, perhaps due to the ability to be more agile in response to the changes.”

As we move further into 2021, retailers need to remain nimble and react quickly to the constantly evolving retail landscape. Opportunities will present themselves, says Gibbs, but successful retailers will be those who can switch between in-store and online offerings and are ready to “take on opportunities as they come in 2021.”

Making predictions amid such uncertainty is not easy. As IMRG insight director Andy Mulcahy explained: “At the start of each year we usually provide a forecast for online sales growth for the coming year. In 2020 things changed rapidly, and it makes predicting 2021 extremely difficult.”

However, he continued, in 2021 we might “have to adjust our understanding of what good looks like.”

At The Delta Group we help businesses get ready to take on new opportunities. To see how we help clients navigate these complex times, get in touch with the team today.