Ecommerce sales fall in January, claims IMRG
2024 has got off to a very slow start for ecommerce sales, with online revenue falling -7% Year-on-Year (YoY) in January against a decline of -3.5% last year, according to the IMRG Online Retail Index, which tracks the online sales of over 200 retailers.
While that is not the sharpest rate of decline in the history of the index – February 2022 was down -29.6% – the drop back then was a consequence of the huge growth recorded during the lockdowns of 2020/21, so the YoY comparison was skewed rather than it being a reflection of low demand. In January 2024, demand felt very weak.
Since the high growth rates seen during the pandemic, ecommerce revenue declined -10% YoY in 2022 and -3% YoY in 2023, with IMRG forecasting 0% YoY growth in 2024. As we moved into the post-Christmas period, the rates of growth have been markedly lower than those seen last year, with big declines even recorded against big declines from the previous year; the payday week (w/c 21 January) saw a decline of -9.4% YoY against -11.1% for the same week in 2023. The -7% drop for January is the second-lowest since the skewed lockdown comparison period in early 2022, with only December 2022 (which was impacted by Royal Mail strikes) seeing lower growth (-9.3% YoY).
Several categories recorded poor growth online, including clothing (-10.8% YoY), beers, wine and spirits (-23.3% YoY), electricals (-8.8% YoY), gifts (-10.3% YoY) and home (-5.7% YoY). However, growth was not universally negative, with garden up +9.2% YoY probably due to the mild temperatures and health & beauty up +9.1% YoY.
Says Andy Mulcahy, Strategy and Insight Director at IMRG:
“Up until around 2019 ecommerce was rightly regarded as an industry with high potential, buoyed by the notion that ‘everything was going online’ and the high street seemed in terminal decline. Around that time though, the overall growth rate for ecommerce had actually started to head toward flat.
“The lockdown period then gave us years of data that was heavily skewed, but what we are seeing now is not just a consequence of that anymore. The economic situation is dire, demand has been impacted, and ecommerce feels like it is no longer immune to tough times but is just as vulnerable as retail more generally and other customer-facing industries.”
