James Hardiman, Junior Analyst, Retail Insight and Analytics, British Retail Consortium:
“Despite the customary slump in retail activity from December to January each year, last month’s seven per cent year on year growth is an encouraging sign for online retailers as it is a step up from last January. Although the sensitivity of online shoppers to online discounts will be a cause of concern to retailers, as this growth hasn’t translated into sales growth.
“Creative direct marketing campaigns are proving to be successful is garnering online traffic, with the trend of declining search engine driven retail visits continuing into the new year. With Social Media making significant growth in originating retail visits again in January, it appears that retailers are improving their ability to appeal to the more socially aware consumers. However, with their over thirty percentage point lead, search engine optimisation remains the most important tool for online retailers.
“However, with declining time spent and pages viewed on retailers’ websites in January, if this trend continues into February, retailers will have to find ever more innovative ways to attract ever more price sensitive consumers. Especially with some time to go before the next big discounting event arrives.”
Giles Longhurst, SVP and General Manager, Hitwise
“Traditionally a quiet month post-Q4 peak, January still saw growth of 6.9% YoY in online retail visits. Whilst this growth rate was lower than previous months (December +7.3% YoY, November +8.0% YoY), January had more positive results than this time last year (where Jan 2017 grew by 4.6% YoY).
“Like last year, the start of 2018 saw clear winners and losers. Leading verticals, such as: Food & Drink (+17.7%), House & Garden (+17.1%) and Health & Beauty (+14.1%), continued their double digit rise.
“Verticals under-indexing to the industry average included: Department Stores (+5.6%), Rewards & Directories (+6.5%) and Books, Stationary & Home Entertainment (-2.8%). Last year saw an extending of promotional periods (pre-Cyber Week to Christmas Week). These verticals were particularly reliant on discount tactics, potentially shifting activity away from January.
“These YoY shifts may also indicate that consumers are spending more on essentials, such as food & household, and less on entertainment and leisure. Potentially, tightening of belts for the year to come.
“Mobile, optimising conversions and delivery fulfilment will be key to success in 2018. Audience targeting will also be vital, as retailers use the starting months of the year to build loyalty and lines of communication with existing and potential customers.”