NAB has released its Online Retail Index for May and it shows ongoing deceleration:
For the 12 months ending May 2012, Australia’s total online spending was around $11.3 billion. This level is equivalent to 5.2% of traditional bricks & mortar retail spending (excluding cafés, restaurants and takeaway food) for the year ended April 2012.
The NAB Online Retail Sales Index rose to 187 points in May 2012 – up from 169 points in April 2012.
In dollar terms, online spending grew by around +14% year-on-year in May 2012. This compares with +15% and +19% year-on-year in April and March 2012 respectively. The growth rate for online sales has slowed considerably since the second half of 2011, with the current rate considerably lower than the level in May 2011 (+41% yoy).
That said, online sales growth remains considerably stronger than traditional retail bricks & mortar retail – which recorded just +0.2% year-on-year growth in April (on a non-seasonally adjusted basis). After seasonal adjustment, bricks & mortar grew at +1.6% – a modest rate when compared with recent history.
Quantium’s research has shown that a growing number of Australian fashion retailers are adopting a multi-channel strategy by including online as an additional contact point with their customers. The data shows that multi-channel fashion retailers are generating up to 30% of their total monthly sales through their online stores, indicating some of the ways that traditional retailers can adapt to the changing environment and use the online retail market to their advantage.
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
