December dazzles as Black Friday papers over online retail cracks
A solid December helped UK online retailers end a turbulent 2019 on a high, according to research by IMRG and Capgemini.
After a difficult start to the year, online sales rose by 9.4% YOY in December. This was not enough, however, to save the sector from the lowest annual performance seen on record.
If online retail in 2018 was characterised by strong growth in the first half and weak in the second, 2019 was the year when Black Friday quite possibly papered over retail’s cracks, observes Andy Mulcahy, Strategy and Insight Director, IMRG.
Demand was low during the early stages, particularly over summer, and overall growth was running at just +4.9% up to October. A solid December, albeit against weak YOY growth in 2018, off the back of a strong November have made the full-year result appear much better at +6.7%; lower than the IMRG’s forecast of +9%, but nowhere near as bad as it was looking a few months’ back.
Outlook for 2020
"The final quarter has been a lot more positive for online sales growth than it has looked for a long time, plus we’ve had the election and Brexit should actually, finally, become something,” Mulcahy comments.
“There are also major sporting events galore in 2020 which could stimulate retail spending. Have we turned a corner then, or is it the case that the fundamental problems affecting retail are still yet to be solved in any meaningful way? Time will tell.”