Online growth in the first few months of this year has been like “smoke and mirrors”, with sales propped up by discounting and shoppers increasingly seeing ecommerce as a promotion-led environment, pure-play and multichannel retailers have warned.
Those Drapers spoke to that have not continued to heavily discount post-Christmas reported a lull in online transactions during the first two months of 2015, particularly in January. The Office for National Statistics reported that last month online sales increased 12% year on year.
The owner of one major footwear etailer said that while many are experiencing growth online, “the market is all promotion-led”.
“Since we went off Sale in January, sales have slowed but we’re still seeing growth on last year. They will click through to see the promoted lines but might end up buying something else at full price so the margin balances out,” he added.
Contemporary womenswear brand Unique 21 launched online in December and has picked up wholesale accounts with the likes of Asos.com, Joy and Lipsy. Head of marketing Kerry Liddell said: “We had a really successful December then there was a dip in January. It’s probably because people spent too much the month before but I think it’s also the case that if you haven’t got a Sale going on it’s hard. It is now starting to pick up again.”
Others such as Andrew Hall, operations manager at women’s young fashion etailer Pink Boutique, said the sales dip wasn’t as big as expected going into the new year and they are now giving a final push to clear Sale stock.
This extends to retailers that operate bricks-and-mortar stores with an online presence.
Chris O’Dea, owner of premium menswear store OD’s in St Helens, said: “Online is tricky. It’s fabulous when we’re in Sale, around 70% of our total online transactions are done then, but full price is difficult. At full price I would say fewer than 10% of our sales happen online.”
Physical stores, largely in London, have been receiving a boost in recent days from London Fashion Week and Chinese new year, which both fell on the same weekend on February 21-22, and half-term holidays.