The pandemic has cemented the shift to online shopping, with Q2 2021 online sales up +64 per cent compared to the same time period in 2019. That’s according to the latest analysis of online retail sales from referral marketing platform Mention Me.
The platform’s Retail Insights team compared data trends since 2019 across beauty, home & garden, fashion, and food & drink to identify long-term trends in the market, beyond the fluctuations caused by changing lockdowns.
While Q2 sales in 2021 are down -15 per cent compared to the extraordinary peaks seen in Q2 2020, prompted by consumers panic buying, the data shows that online shopping has increased significantly compared to 2019. Across the four sectors analysed, online sales have increased +64 per cent.
The beauty sector has performed best over this time period, with online orders up +78 per cent from Q2 2019. This is closely followed by fashion (+58 per cent) and home & garden (+67 per cent). Despite the re-opening of retail, the four sectors are only tracking 2 per cent down from where the research team would expect them to be at this time of year.
The online food & drink sector has significantly grown during the pandemic, as consumers switched their buying habits and tried out new brands. As restaurants have reopened, consumers have diversified their spending, with Q2 2021 sales down 11 per cent compared to Q2 2020. However, the research shows consumers continue to buy more food and drink products online, with sales up 60 per cent compared to Q2 2019.
Referrals emerge as key growth channel
A key emerging trend over the course of the pandemic is how we rely on the recommendations of friends and family to find brands.
Food and drink was the most referred category in Q2. The volume of orders saw an increase in 2020. Although orders are subsequently decreasing, they are still above pre-lockdown levels. The rate of referring friends and new customers from referrals continues to increase, despite order volumes lowering. This suggests that despite lockdown easing and orders lower than the peaks of 2020 the increased familiarity of customers to refer friends to brands they enjoy is here to stay.
Commenting on the data, Simon Dring, head of retail insights at Mention Me said, “Monthly, or even weekly, volatility as a result of the pandemic has distracted from the long-term trends shaping the retail industry. When you take a step back, it’s clear we’re seeing a permanent shift to online-first retail.
“One of the biggest challenges for retailers is that they’ve built up a significant amount of data over the past two years, but don’t know what to do with it. Many online retailers acquired significantly more new customers in lockdown, they need to quickly figure out how to keep these customers in the face of more online and offline competition. The focus has to be figuring out who your new customers are and what they value in you as a brand.
“With that approach, retailers will be able to tap into referral growth. As our data shows, referrals are a hugely valuable source of sustainable, organic growth for brands with the tools to leverage it.”
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