Online Sales Growth Hits Two Year High in June

Online retail sales leapt by their highest annual rate of growth in two years during June, though the average value of a consumer's basket of goods tumbled as the wage decline continues.

The IMRG Capgemini E-retail Sales Index jumped 20% year-on-year in June. The index also saw its first monthly growth in the May to June period for over five years, when sales rose 2.4%.

UK inflation hit 2.9% in June, far outstripping pay growth with has stuck at around the 1% mark. This means household incomes are being hit be a real terms cut, reducing the amount of disposable cash that can be spent out in retailers.

Sales from mobile devices, such as tablets and smartphones, also continued to rocket last month. IMRG Capgemini's M-Commerce Index bounced 136% year-on-year in June and 8% on the month.

Promotional activity and discounting meant that while sales rose, the average basket value of goods for cost-conscious consumers fell 9% on the year in June, to £79 (excluding travel).

"The online retail market has performed above expectation so far this year, with H1 coming in at 16% average growth against our earlier forecast of 12%," said Tina Spooner, chief information officer at IMRG.

"We haven't seen the rate of year-on-year growth recorded in June for two years, which is around the time confidence in an economic recovery seemed to be heading toward its lowest ebb.

"The solid growth last month was driven by a strong performance in clothing, perhaps as a result of heavy discounting, however the UK online retail market has performed remarkably consistently throughout 2013 so far, which may signify an overall improvement in consumer confidence that will be welcome news for many."

Sales from mobile devices, such as tablets and smartphones, also continued to surge in June. IMRG Capgemini's M-Commerce Index bounced 136% year-on-year in June and 8% on the month.