Spending online continued to increase in August, reaching a new record proportion of all retailing at 18.2 per cent, with strong growth in department stores also reaching a record high of 18.4 per cent.

Office for National Statistics (ONS) figures for last month showed the overall quantity bought in the UK increased by 0.3 per cent when compared with July.

The month-on-month growth rate in the quantity bought in food stores was down 0.6 per cent and clothing stores at negative 1.9 per cent, but this was offset by strong growth in other non-food stores at 2.8 per cent and household goods stores at 4.5 per cent.

The latest IMRG and Capgemini e-retail sales index showed UK online retail sales being steady this August, as shopper spending achieved 12.8 per cent growth year-on-year.

The ONS published a supplementary report this month on comparing bricks and mortar sales with those online. IT pointed out that in in 2017, online sales increased by 15.9 per cent from the previous year; an increase of £8.2 billion to £59.8 billion. This is in comparison with an annual increase of 2.4 per cent within stores; up by just over £7 billion to £306 billion in 2017.

Despite the stronger online presence, consumers spent most of their money in stores and the majority of online spending was done within non-store retail.

In 2017, The PwC commissioned research by the Local Data Company, which studied the top 500 British town centres. It found that while the number of new stores opening is decreasing, the number of store closures is increasing.

This led to a total loss of 1,772 stores in 2017, an increase since 2016. When combined with the growth within e-commerce sales, this has led to increased interest in how consumer behaviours are evolving.

“The strongest growth in online sales is within the non-store retail sector, where we have seen an increase in retailers without a store presence in more recent years,” read the ONS report. “This is followed by non-food stores, which is due to the combined growth within department stores, other non-food stores, clothing and household goods.”

The ONS concluded that whilst online sales are growing at a fast rate, bricks and mortar sales still account for nearly 82 per cent of sales. “Online spending has increased at a fast rate whilst spending within stores has remained relatively stable – these changes in spending habits mean consumers are now buying more online than ever before.”

Andrew Westbrook, head of retail at audit, tax and consulting firm RSM, noted that the findings might give the chancellor more reason to consider the introduction of a so-called ‘Amazon tax’.

“However, he will have to be mindful of the possible impact on physical retailers using online sales profits to offset store losses, or on those small retailers using online platforms,” stated Westbrook.

ParcelCompare’s head of consumer research David Jinks pointed out that the likes of House of Fraser and Debenhams missed out on this growth in online spending with department stores.

“House of Fraser’s online site was never the best; we frequently criticised it for antiquated web integration; ordering large furniture meant leaving the main site and linking to a white label site operated by ‘rival’ furniture store A Share & Sons – best known for their ScS stores,” he stated, adding: “Nonetheless, even a flawed online offering was better than none at all, which was the case for most of August.”

Jinks argued that if Debenhams was able to poach House of Fraser’s online share it could help bolster the “beleaguered” department store.

“There is much talk that Sports Direct founder Mike Ashley, who owns just under 30 per cent of Debenhams shares as well, is looking to somehow consolidate the two companies. Maybe August’s online boom will be enough to keep the store out of Ashley’s questionable embrace.”

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