eCommerce drives experience purchases in April

eCommerce grew 8.4% in April, as more consumers are spending their money on pre-booked experiences such as holidays and tickets.

According to Visa Europe, consumer spending online grew at the fastest rate for 16 months in April. Total consumer spending increased 2.5% year-on-year in April, eCommerce grew 8.4%, but in-store spending remained flat, at 0.2% year-on-year.

Visa Europe statistics stated clothing and footwear suffered the biggest fall in year-on-year spending since September 2014, as customers are spending more of their money on experiences which can be pre-booked online.

"Growth in consumables remains evident, but consumer spending is increasingly focused on the experience economy. Eating out, booking holidays and discovering new experiences are all driving spending growth at a time when the lower cost of living is creating higher disposable incomes. In a month of mostly growth, the only sector to disappoint was clothing and footwear, again highlighting this shift," said Kevin Jenkins, UK and Ireland managing director at Visa Europe.

"A very strong month for online sellers suggests much of the experience economy is being driven by pre-booking of activities online," he added. "While online prospered, face-to-face spending was relatively flat, highlighting the current discussion about the future shape of the high street as well."

But Gayle Haddock, owner of Carry Me Home, said April was a good month for her boutique London store. "The cold weather helped us to sell some winter pieces and drew more customers towards the discounted mid-season sale items," she said. "Our online sales in particular have surged, as more regulars take to our website to quickly get hold of the items they’re after. Social media partnerships with parent and toddler groups and online competitions have also helped to increase our online presence and have allowed us to reach customers further afield."                                        

Meanwhile, Luke Griffiths, UK managing director at Klarna, added: "The message is clear - all retailers need to focus on their online shopping experience. These statistics actually describe a dual transition – not just away from the high street towards eCommerce, but within eCommerce towards mobile shopping, which is driving the growth of a $3 trillion global online payments market."

But Griffiths said mobile shopping presents a whole different set of challenges for retailers. "A shopper sitting at a desk would still be focused on the experience, able to view multiple items at once, able to type in personal data or credit card numbers relatively easily. None of those can be guaranteed on mobile. The window of attention for mobile shoppers is small – the need to tap in details like an address or a credit card number could kill a sale.

"At the moment, 71% of transactions are abandoned on tablets and 81% on mobile phones – an incredible number. Britons may spend £60 billion online in 2016, but where they spend that money will depend on how well retailers move to mobile. Retailers who can provide both a seamless online and mobile experience will reap the benefits of customers who are able to purchase goods and easily on any device on the move, any time."

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Visa Europe

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