Overview
May 2021 reported the first YoY decline since the UK went into full lockdown over a year ago. The result was almost inevitable given the scale of 2020 trading the current market is being compared against. Mays result is the largest Year-on-Year drop for any single month since IMRG began tracking the market in 2000. In particular, Home & Garden, Gifting, Health & Beauty and Electrical retailers will likely be looking at current YoY growth rates with a grimace. However they may be encouraged by fact that online trading is still in a good position when the wider picture is taken into context….
IMRG conducted a special analysis to see how 2021 trading stacks up against 2019 trading. The concept being that 2019 was a ‘normal’ year and could act as a sensible benchmark to compare against current trading, instead of the wildly unusual year of 2020. May 2021 Vs May 2019 shows a 46% YoY uplift, highlighting that demand is certainly still very high in comparison to a ‘regular’ year. Its worth noting that the whole of 2021 so far would have reported higher YoY growth rates when compared to 2019 instead of 2020 (Jan would be +90%, Feb: +86%, Mar: +82%, Apr: +63%). We have included the results of May 2021 Vs May 2019 as an extra column in this months results as a one off interesting data addition this month (see below table)
May 2021 included the first week of indoor meetups and hospitality locations being opened up as part of the Governments easing of lockdown restrictions. Speculation had warned the new social opportunities could detract from online shopping demand, and it looks to be true…during that week online retail posted a 5.9% Week-on-Week decline. Notably the market did bounce back for the final week of May and posted a 7.2% week-on-week uplift.
IMRG have developed three forecast scenarios for how 2021 will unfold based on a Good, Average and Bad result. The forecast figures are based on how the country reacts to lockdown easing milestones, travel restrictions and last years trading. During May the market was narrowly below the ‘Average’ result, but it had outperformed expectations for the first quarter of the year. We have discussed the forecasts with over two-dozen ecommerce directors, the majority of whom agreed with our ‘Average’ scenario, where a likely outcome for year (and a welcome one it seems) would be a final annual growth of around 10% (the market is currently at +36.8% thanks to a strong first quarter, tough comparative months ahead will slowly bring that figure down)
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