2009 Online Trading Data – How did Online fare in the Credit Crunch?

Christmas is a critical time of year for the retail industry. Over the past few years online retailers have fared better than their High Street counterparts.

Online spend slowed down in October 2009. Sales were only up 1.9% from August, an "unusually low rate" according to research by IMRG. Localised postal strikes are possible explanations for this.

However, things picked up before Christmas, helped by the threat of a national postal strike not materialising. UK shoppers spent £5.3bn online in November, with sales up by 25% on Octobers, and by 11% compared to November 2008 (IMRG).

In fact, on 7th December, one of the busiest days for online retailers in 2009, £1.4m was spent online at 13:43 in just one minute, with sales peaking at £33m between 13:00 and 14:00 (IMRG, "The Biggest UK Online Shopping Day of 2009 Set to be the Biggest Ever").

This seems to have been a trend experienced in retail overall as December retail sales rose to hit a four-year annual high. Total sales increased at an annual rate of 6% – the fastest since April 2008. The British Retail Consortium says that Christmas sales were 'stronger than we dared hope'. *

However, the same report Warning that consumers' spending surge may not continue and that a healthy December may be only a temporary respite on the painful road to recovery.

The increase in the VAT rate back to 17.5% is also a factor to be considered (see 'Changes to VAT Regulations' for more information).

However, only time will tell what 2010 will bring.

*Source - The Guardian