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Thursday June 18, 05:01 PM
Online Sales Lose Sizzle Amid May Sunshine

By © Sky News 2009

Online Sales Lose Sizzle Amid May Sunshine
Click to enlarge photo
Online sales growth slowed to its lowest level on record last month as as warm bank holiday temperatures sent shoppers outdoors.

Latest figures show year-on-year growth dropped to 8.2%, down from a 30.9% increase in 2008.

Despite the slowdown, internet sales were valued at £3.7bn last month by the IMRG Capgemini e-Retail Sales Index.

Mike Petevionos, head of retail consulting at Capgemini UK said: "Although online sales remain healthier than on the high street, UK shoppers are clearly changing their behaviour as a result of the recession.

"Even those heading online to economise are now beginning to trim spending habits.

"So whilst the underlying trend is still one of growth for online retail, the market conditions are placing all retailers under pressure to ensure their offerings remain competitive."

Overall online sales declined 3.5% in May compared to the previous month.

But the balmy weather led to a 14.9% rise in health and beauty products such as sun creams and moisturisers.

The internet still fared better than the high street, with latest figures showing retail sales fell by 0.6% between April and May.

Tina Spooner IMRG's director of information said: "Almost any business would be delighted with an 8% growth in the current market conditions so while this is a poor performance in internet shopping terms, actually it is very positive compared to high street sales.

"Consumers today are making very considered purchasing decisions, relying heavily on the internet to qualify their buying both online and in traditional stores, so online retailers will be the first to see 'green shoots' when the economy finally begins to stabilise," she concluded.

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