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November 25, 2009

Postal strikes hit e-retail sales

British shoppers spend £4.2 billion online in October

By CBR Staff Writer

Growth in e-retail sales was down by 7% over two weeks, due to postal strikes, according to IMRG Capgemini e-Retail Sales Index.

However, the index saw 11.8% increase year on year and 8.4% month on month in e-retail sales. British shoppers spend £4.2 billion online in October.

According to the index, delivery concerns had a noticeable impact on online clothing sales with 13.2% growth, which fell short from the average of 27% for the month of October in previous years.

However, in contrast, the potential delivery delays had a positive effect on e-retail sales for gifts as shoppers spent a massive 113% more in October compared to September and 40% more compared to same period last year, due to consumers buying Christmas presents earlier to avoid empty Christmas stockings. In addition, gift e-retailers also kicked off festive promotions much earlier compared to earlier years.

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Tina Spooner, director of information at IMRG said: “Whilst the overall Index returned to double-digit growth in October, the decline in e-retail sales values and volumes during the second half of the month shows that consumer confidence was affected by the Royal Mail strikes. However, with the threat of further strike action now averted in the run up to Christmas, shoppers’ concerns around delivery will no doubt be dissipated.

It remains to be seen whether consumers will play a waiting game over the coming weeks as they look for the best bargains online in the hope that retailers will begin discounting as Christmas approaches.”

IMRG and Capgemini expect that Christmas will come early for e-retailers this year, as shoppers rush to avoid postal strikes by stocking up on presents further in advance.

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