Online Retail Offers Promising Christmas Season Ahead of Slow October

Power Retail By Power Retail | 06 Dec 2019

The latest report from the Australian Bureau of Statistics (ABS), has indicated a relatively unchanged turnover for retail in Australia. The report found that September experienced a turnover of 0.2 percent, but October had no change, sitting at 0.0 percent, which has been seasonally adjusted. 

Within specific categories, including apparel, department stores and household goods saw a slight drop, as Ben James, Director of Quarterly Economy Wide Surveys, explained. “There were falls for clothing, footwear and personal accessory retailing (-0.8 percent), department stores (-0.8 percent) and household goods (-0.2 percent).”

As such, these drops were counterbalanced by an uplift in other categories. “These falls were offset by rises in cafes, restaurants and takeaway food services (0.4 percent) and food retailing (0.1 percent). Other retailing was relatively unchanged (0.0 percent),” James continued.

Trends throughout the country indicate varying results, ABS found. “VIC (-0.4 percent), NSW (-0.2 percent), and SA (-0.5 percent) fell,” the report stated.  “…while QLD (0.4 percent), TAS (1.4 percent), the NT (2.3 percent), WA (0.2 percent), and the ACT (0.3 percent) rose in seasonally adjusted terms in October 2019.”

These numbers are not overly concerning, as they represent a few hard months throughout the industry. “Despite tax cuts and interest rate drops, today’s figures show that consumer confidence has remained low,” explained Dominique Lamb, CEO of the National Retail Association. “The good news though is that feedback we have received so far is that the Christmas trade period is acting as the circuit breaker needed to turn things around.”

These reports do not indicate a serious underlying issue with retail, as seasonal sales events including Click Frenzy, Black Friday and Cyber Monday indicated strong growth YoY. Dominique Lamb noted that Cyber weekend was the ‘busiest weekend of the year’, “Aussie shoppers splurged a record $5 billion as retailers offered bargain prices,” she said.

According to the ABS report, online retail turnover contributed 6.5 percent to total retail turnover in original terms for October 2019. In October 2018, online retail turnover contributed 5.9 percent to total retail. Hitwise data showed that Click Frenzy saw 6 percent growth YoY for traffic to participant sites, with the leading retailers including Catch (+18 percent), MyDeal (+78 percent), IKEA (+40 percent) and The Good Guys (+29 percent).

Moreover, downstream sites from Click Frenzy, including The Good Guys, Booze Bud and MyDeal saw growth of 4,786 percent, 212 percent and 106 percent, respectively. “Amazing results for our sellers during Click Frenzy 2019. 106 percent growth YoY means more consumers are getting the best deals at the most important time of year on MyDeal,” explained a spokesperson for MyDeal.

“For the first time ever, Black Friday was the busiest day of the year for online spend, demonstrating that the event is picking up more momentum each year. Discretionary spending has been the big issue in 2019, but with shoppers descending on shopping centres for Black Friday, the feedback has been that people have finally unlocked the padlock on their wallets or purses,” she continued. “Early signs are that the slow retail sales experienced for much of 2019 has not transitioned into the Christmas period.”

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