E-commerce growth reaches all-time low

The recession has taken its toll on online retailers

E-commerce growth has slowed to an all-time low as shoppers rein in their spending during the recession, according to the IMRG Capgemini e-retail sales index.

Web sales in May increased 8.2 per cent year on year compared to the 30.9 per cent growth rate of the same month last year, as online retailers begin to feel the effects of the recession.

And a month-on-month decline from April of 3.5 per cent also represents the first monthly web sales fall in nearly a decade.

Despite the latest figures, the report says that sales volumes of £3.7bn in May prove "a robust underlying strength in online sales".

"UK shoppers are clearly changing their behaviour as a result of the recession. So, while the underlying trend is still one of growth for online retail, the market conditions are placing all retailers under intense pressure to ensure their offerings remain competitive," said Mike Petevinos, head of retail consulting at Capgemini UK.

"Those who support their customers to shop in the way they want to, and do not lose sight of them as they move between the store, the web and the phone, will gain added advantage in providing a compelling shopping experience too.

"This is a key goal of true multi-channel retail, and it will become increasingly important."