Online retailers score big over Christmas

Online retailers have seen record growth over the Christmas period, saying consumers are now beginning to increase their spending habits as the economy recovers.

However, many are also saying the growth in sales is not solely due to economic recovery, but to the overall take-up in online sales.

Andrew Cooper, chief executive of the dStore, says his site has recorded growth but admits the sales were a “bit subdued” due to the third consecutive interest rate rise in December.

“Overall, we were up 15% in the Christmas quarter, but it was tracking well until the interest rate cut came in. We were recording 37% year-on-year growth in November, and we might have been up higher in December if that hadn’t happened.”

Tony Nash, chief executive of Booktopia, says his company’s overall growth through the year helped it gain sales during the busier Christmas period.

“We definitely had growth… of about 30%. We had 70% more customers who had bought from us over the year, so we were bound to grow. But it was interesting, this year people didn’t wait until the sales to buy their Christmas gifts, and that’s because people are getting over the GFC.”

“But we also had more competition this year, as Borders is in the online marketplace now when they weren’t last year. So most of the big boys have gotten their act together and they certainly would have felt the impact.”

Gabby Leibovich, founder and chief executive of Catch of the Day, also said he had recorded massive growth in the year and considered his business safer for being in the online space.

“Our Christmas period ends about the 10th of December, but I noticed a huge growth in sales simply because we’ve been growing and multiplying, with about 300% growth in the last year.”

“We’re just in a completely different state to your average business. Some may increase by 50-60% if they’re good, but we’re pretty much doubling the amount of money the business has each six months. I would go so far as saying we are the fastest growing online shop in the country.”

Chris Ryan, co-founder of online mobile store Strike, says he has seen growth in Christmas sales, which has been the result of promoting the site over the last 12 months.

“Online retail has been resilient, and I think our site has improved, our search traffic as improved, and I think doing a bit more marketing and PR has helped.”

“However, it certainly was a volatile period. The whole period overall has improved, but week one of December was massive, then week two was quiet and then week three was normal, so I’m not sure for the reason for that. Overall it was certainly well up, but the weeks were volatile.”

Additionally, these retailers suggest operating on the internet has given them a head-start against bricks-and-mortar retailers, which have been forecast for some time as expecting a subdued Christmas period.

“The only retail we do is online, and I think being on a site and being a bricks and mortar retailer are two different things,” Ryan says. “I don’t think anyone is doing really well in both, though. It would be good to see one of the big retailers acquire an online retailer… online retail is a bit immature, but it’ll get better as time goes on.”

Cooper says online retailers are in a better position to record growth over the Christmas period, but is hesitant in saying the two sectors are opposed to each other.

“I do think we’re in a better position, but I don’t want to overplay that because in general the online retail market is growing and it’s hard to get reliable numbers. But there’s no doubt there has been growth in the industry. Better to be in a growth industry than in an industry with little growth, which is I guess where traditional stores are at, at the moment.”