Covid-19: Online continues yoy growth despite stores reopening

eCommerce sales grew 34% year-on-year in June 2020 – the highest growth rate reported since March 2008.

According to the IMRG Capgemini Online Retail Index, shoppers continued to turn to online shopping during lockdown, despite stores reopening halfway through the month. The high growth rate also built on May’s record increase, with a 3.5% month-on-month increase in sales.

All verticals benefitted from the sales increases, excluding fashion which continued to fall, this time by 6.5% year-on-year. Footwear also fell 18.4% year-on-year.

But the success in electricals (+99.7%), wine and spirit (+79.9%) and health and beauty (+72.8%) helped to drive a significant overall increase in year-on-year online shopping.

“In June, growth for online retail sales was once again at a rate we’ve not seen since 2008, even with the shops open for half of it. So, initially at least, online has proven resilient to the reopening of the other main outlet for retail; the high street. However, as of 4th July, people have more options for how to spend their money, as pubs, restaurants and other leisure spaces have opened,” said Andy Mulcahy, strategy and insight director, IMRG.

“So how long will the online boom last? For some categories (such as grocery and beers, wine and spirits) it seems reasonable to assume that some of the regular demand will have shifted online for good, while for other categories the huge surges they have seen might reach natural limits and slow down. It seems remarkable to suggest that we might be seeing the gradual start of that in garden, where in the last week of June for example, growth was ‘only’ +57% – the lowest for that category since lockdown started.”

Online is likely see further demand in the future as the retail industry continues to announce store closures and job losses. This week, John Lewis revealed it would be closing eight stores, putting 1,300 jobs at risks, while Boots will be cutting 4,000 jobs across HQ and stores.