Parcel volumes generated by online retail sales in the UK grew strongly by 15.5% (year-on-year) in October, despite the upcoming Black Friday event this Friday which is expected to generate over £1 billion in online sales with shoppers waiting for discounts on this day, according to the British e-commerce association IMRG.
In view of Black Friday taking place on 27th November and shoppers’ awareness of the potential for discounting activity high, “the October performance is ahead of what many may have expected”, IMRG explained. It is the highest rate recorded for the month of October since the IMRG MetaPack UK Delivery Index launched in 2011.
This stands in contrast to the 8.9% growth in the UK online retail sales during the same month which is the lowest-ever annual growth in October in 15 years since the launch of the IMRG Capgemini e-Retail Sales Index.
The strong growth in e-parcel volumes seems to be driven by shoppers continuing to purchase lower-cost items with sectors that usually generate lower average basket values performing quite strongly in October. Thus, the product categories accessories, footwear and lingerie, recorded a solid performance in October, with an annual increase of 24%, 23% and 19% respectively.
However, while some sectors selling higher-cost products such as garden and electricals recorded negative growth in October, it doesn’t mean that online shoppers no longer buy more expensive items, IMRG stressed. “The disparity between revenue growth and parcel growth suggests that products from multiple sectors are shifting, but at discounted rates for categories such as electronics.”
The rate of on-time delivery has been high all year with a 93.6% success rate being maintained into October.
Andrew Starkey, head of e-logistics, IMRG, said: “The strong performance for October suggests that shoppers are still making purchases even though many know that the heavy discounting period is just around the corner. Despite the news that some major retailers have decided not to specifically participate in Black Friday promotions, we do expect a similar pattern to last year – with a sharp fall-away in sales leading up to Black Friday followed by a huge spike in demand at the end of the month and into early December. However, we do anticipate that many retailers will be launching Black Friday marketing throughout the week, which may help to spread the demand.”
Kees de Vos, Chief Product Officer at MetaPack: “The trend, supported by the October figures, is towards growth, and this will continue to the end of the year. Our view is that orders will hit record numbers over the Black Friday weekend and parcel volumes will run throughout December with a second delivery peak reaching the highest numbers immediately after the Christmas break and before New Year. However, retailers have adopted new strategies and this will help to spread the delivery load over a much longer period of time.”
According to figures by IMRG and the global information services company Experian, the upcoming Black Friday is estimated to generate £1.07 billion in sales across the UK, which would be the first time ever that UK online retail sales exceed £1bn in a single day. Compared to Black Friday in 2014 when British online shoppers spent £810 million, this would equal an impressive year-on-year increase of 32%.
The IMRG MetaPack UK Delivery Index was designed to enable the e-retail industry to track a wide range of key benchmark metrics to enable organisations to benchmark performance, track trends and inform strategic decisions. The index covers more than 200 retailers and an average of more than 5 million orders per month.
