Australian online retail sales jumped in May, taking Australia’s total online spend over the past year to nearly $20 billion.
According to the latest NAB online retail sales index, sales increased by 2% in May in seasonally adjusted terms, leaving the year-on-year increase at 13.2%.
As a result of the rapid growth, nearly three times faster than that recorded at traditional bricks and mortar retailers, the NAB estimates that Australians spent $19.9 billion online over the past 12 months.
The NAB estimates that online sales now equate to 6.7% of traditional retail sales – and only likely to get larger if the chart below is anything to go by. The black line measures growth in online retail sales, comparing it to traditional bricks and mortar retailers, shown in grey.
As the figures below suggest, the headline increase came courtesy of enormous growth in food, fashion, media and games retailing, helping to offset weakness in homeware and appliances sales, the largest category by total dollar spend.
A key driver of the overall result was fashion sales, which expanded rapidly (21.1% yoy vs 8.6% yoy in April).
Sales growth also improved faster in games and toys (41.6% yoy vs 16.2% yoy), department and variety stores (6.6% yoy vs 3.3% yoy), personal and recreational (8.4% yoy vs 7.5% yoy), and Daily Deals (3.2% yoy vs -8.3% yoy).
Sales slowed in Food Catering (39.1% yoy vs 50.3% yoy), Groceries and Liquor (6.3% yoy vs 8.3%), media (26.3% yoy vs 27.3% yoy). The largest spend category, homeware and appliances contracted (-1.7% yoy vs 0.4% yoy), though this slowdown was not enough to counter the growth in all other segments.
For smaller online retailers, the news was even better with sales increasing by 22.7% from a year earlier, the fastest growth seen in the history of the survey.
A significant gain, particularly as sales from smaller retailers now account for over a third of total online spending.
The only question now is whether the strength in online retail sales will be replicated by Australia’s official retail sales report for May, released by the Australian Bureau of Statistics on Tuesday.
Economists polled by Bloomberg are looking for an increase of just 0.3%, something that would continue the weakness seen earlier in the year.