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Australian online retail sales fell unexpectedly in May, and the big driver was a collapse in daily deals, the special offers that were once all the rage for businesses trying to reach new customers and generate quick cash flow.
According to the latest online retail index from the NAB, sales dipped 0.1% in May, a figure well below the 1.6% increase previously recorded in April.
Daily deals as a category were down a whopping 26%.
Despite the decline, the NAB estimates overall online sales grew to $17.1 billion in the year to May, an increase of 9% on a year earlier. In April, sales were estimated to have increased by 10.2% from a year earlier.
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All sales categories aside from daily deals and personal recreational goods grew from a year earlier, with electronic games and toys, at 20.8%, recording the fastest overall growth.
“All categories except Daily Deals (-26.2% yoy) and Personal and Recreational goods (-0.6 yoy) recorded growth in May. Electronic Games and Toys (20.8%) experienced a significant growth though this segment is a relatively small share of spend and its growth rate is typically more volatile than other categories. Media and Homeware & appliances have maintained double digit growth (yoy), with Fashion joining the fast lane in May. Grocery and Liquor, and Department stores continued to grow, albeit at more moderate single digit rates”.
In May, the Australian dollar fell 4% against the US dollar and 2.5% in trade-weighted terms according to the RBA. While international online sales are a far smaller component of total sales than those made domestically, this may have contributed to the monthly recorded.
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