Online Retail Sales Drop In October
As a business with a professional interest in e-commerce fashion photography, we regularly take notice of sales forecasts and changes in consumer habits. Statistics alone don’t always tell the correct story and it is by looking at a broader, more detailed picture that we can understand where retail and fashion currently stand.
The focus of this article is on online retail sales in the past month, as well as consumer spending.
A drop in online sales despite an increase in traffic
With a focus on October, reports show that online retail sales in the UK were down by more than 3% year-on-year. It is important to note that this is already compared to the -7.3% level of growth last October, compounding just how poor current online retail sales are.
Online traffic is showing an increase, of a minimal 2.1% but this does show a continued focus for consumers to shop online. To balance out this trend, conversions were down by a massive 20% in October 2022 compared to October last year. From an e-commerce fashion photography perspective, this suggests that the traffic is there for online retailers but it is becoming harder to convert that traffic into sales. Could improved marketing and imagery help cover some of those lost conversions? Or is it simply about the cost-of-living crisis those in the UK are facing?
Are there any specific niches that have caused this decline?
Starting with clothing, the picture has been relatively positive when compared to the previous year until growth started to flatten out in October. Moving on to online sales for health and beauty, October was another bad month with a -7.2% decline compared to last October.
Looking at the trading conditions for items online that fall within the gifts category, Andy Mulcahy from IMRG found that the industry is seeing drops of anywhere between 20 and 30%, on top of similar drops in the same period last year. This tells us just how much people are limiting their expenditure on luxuries like gift-giving at Christmas.
Away from these negative results, data shows that furniture is showing signs of growth that will be warmly welcomed by online retailers. With a 2.9% increase year-on-year, it may not seem like much but it does show how consumer habits are changing. Going deeper into these figures, we can see that the cheaper furniture options are showing strong growth, near the 10% mark whilst premium furniture goods are down by a massive 42.8%. All of these figures are compared to the same period in 2021.
So what does this all mean?
Put simply, we’re seeing an industry continue to struggle and the signs are that everyone linked to online retail will face continue concerns moving into the holiday period. Whilst there is hope that consumer spending will improve at Christmas for some businesses, the reality is forecasts tell us that many people plan to reduce spending in the coming months as people tackle the cost-of-living crisis.
