The record-breaking rate of growth enjoyed by the Australian ecommerce sector early in the coronavirus crisis slowed to a more moderate growth rate in June, according to new figures.
Year-over-year the sector is holding the ground it gained in March and April when stores were forced to close under social distancing restrictions.
According to the NAB Online Retail Sales Index, released yesterday, in the 12 months to June, Australians spent $35.69 billion on online retail, that’s around 10.7 per cent of the total retail trade, and about 23.1 per cent higher than the 12 months to June 2019.
In year-on-year terms, the growth in the NAB Online Retail Sales Index (+49.6% y/y) is on par with the previous month. The year-on-year result implies that, even after the easing of restrictions, online sales growth remains elevated.
Month-on-month online sales grew just 0.2 per cent from May to June, 2020. This result comes after the Index recorded a massive 16.4 per cent increase in April 2020.
“Our NAB Online Retail Sales Index data returned to more moderate growth in June, from the contraction in May and record growth in the two months prior,” said Alan Oster, NAB chief economist.
“While online retail sales growth is typically volatile month to month, the recent changes that COVID-19 has brought to the broader economy, and day to day life, has made it even more so.”
The crisis, which forced stores to close, has set a new baseline for online retail sales. Australia Post is predicting that online sales will account for 15 per cent of all retail sales by the end of 2020. Newly imposed retail restrictions in Victoria are also expected to drive another big wave of ecommerce transactions in August.
Across the Index the June performance was considerably mixed based on category and state results, somewhat reflecting the varied restrictions around Australia.
Four of eight categories recorded a sales growth in month-on-month growth terms. Growth was led by large sales category, grocery and liquor, along with media, homewares and appliances, and personal and recreational goods.
The biggest drop was recorded in the smallest sales category, takeaway food, although this was second fastest in year-on-year growth terms. Given their share of the index, the contraction in fashion, and department stores, had a considerable impact in offsetting the monthly growth result.
Monthly growth was driven by domestic online retailers, with sales at international merchants contracting again.