Online retail growth fell to its lowest level in four years last month as economic uncertainty hit consumer confidence, new data shows.
UK online retail sales were up 11% year-on-year in July, down from +12% in June and +18.6% in July 2016, according to the latest figures from the IMRG Capgemini e-Retail Sales Index.
However, there was a notable increase in the percentage of site visitors completing a purchase on online retailer sites in July, with the overall conversion rate reaching +5.8%, 21% higher than a year ago.
The clothing and home and garden sectors in particular saw jumps in conversion rates, which were up 43% and 83% respectively.
The fact that the conversion rate rise wasn’t matched by a similar boost in online sales revenue growth suggests that discounting activity was high in July, as retailers tried to compete with Amazon Prime Day.
Bhavesh Unadkat, principal consultant in retail customer engagement design at Capgemini said: “We’re seeing the slowdown in purchasing continue across July as this trend of low consumer confidence lingers. With the pound almost running level with the euro luxury purchases and ‘nice-to-haves’ are hit hardest.
“While conversion rates are up broadly speaking, this is only with repeat buys or necessities. Even with enticing luxury offers made available to try and compete with Prime Day, more browsing choice lead to a further dip in conversion for these categories with consumers browsing more but buying proportionately less.”