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Retail sales slow online and on high street in May

A slowdown in overall UK non-food retail sales was mirrored online in May as web sales growth fell to its lowest on record, according to new research.

The British Retail Consortium (BRC)-KPMG Online Retail Sales Monitor found that internet sales in the UK, excluding food, grew by 4.3% year on year in May – way down on the 13.7% rise recorded one year before.

It represented the lowest growth since December 2012, while a 7% year-on-year rise in sales for the three months to May was also the lowest jump in non-food online sales since the BRC series began in December 2012.

BRC CEO Helen Dickinson commented: “Though sales in all categories but one saw growth, this was subdued as consumers held back on non-essential purchases.

“For the second consecutive month, the increase in the online penetration rate has remained below one percentage point,” she said. “Retailers will be increasingly looking to innovate and optimise their online channels to convert a greater share of online browsing into sales.”

Dickinson added that where there was a willingness to spend, it was typically concentrated on value lines – with the clothing and beauty categories among those sectors boosted by some late season promotions.

Paul Martin, UK head of retail at KPMG, described May’s online retail sales rise as “meagre” and urged retailers to focus on developing their customer-centricity and personalisation propositions to convert shoppers.

“Ensuring the right products are available at the right time, and that surplus stock is not sold at significantly reduced prices, is becoming ever more important,” he noted.

“Success will come from an ability to target the online shoppers who spend more and return less.”

Separate analysis of the overall UK market by the same two organisations found that May’s retail sales decreased by 0.4% on a like-for-like basis from May 2016, although food sales were up by 3.2%.

The wider slowdown in sales was attributed to inflationary pressures and said to be indicative of a longer term trend of a decline in consumer spending power.

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