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Online retail sales grow in December, thanks to late Cyber Monday

NAB’s monthly Online Retail Sales Index grew 2 per cent month-on-month in December, seasonally adjusted, thanks to Cyber Monday, which extended the sales event into the first two days of the month.

The jump follows strong growth in the Index in November, when Black Friday helped push online sales up 2.7 per cent month on month, seasonally adjusted, and it compares to a 0.5 per cent decline in overall retail sales in December, according to the Australian Bureau of Statistics.

Alan Oster, NAB’s chief economist, said e-commerce grew faster than the retail sector as a whole because online retail sales tend to be more sensitive to sales events.

According to NAB, online retail sales increased about 48 per cent over Black Friday/Cyber Monday 2019 compared to the same four-day period in 2018. As a four day block, the sales event has been gaining momentum since 2016.

However, NAB said it is likely that these sales events are shifting the period when sales occur, without adding to total sales. The data suggests that the first two days of the event, Black Friday and Saturday, represented around 17 per cent of total November online sales. Sunday and Cyber Monday, which followed in December, represented over 15 per cent of December sales. In the comparable period of 2013, these values were 10 per cent and 11 per cent respectively.

“All these factors are contributing to changing patterns of spending within months, and across months. This is problematic for the seasonal adjustment process, contributing to swings in the monthly retail sales data,” NAB said in its monthly report. 

“For online retail sales, while November remains the largest sales month, […] the large sales for the first two days of December have slightly increased the seasonal importance for that month.”

All categories except fashion recorded sales growth in December. The smallest spend share category, takeaway food, grew fastest month on month, seasonally adjusted, followed by games and toys and department stores.

The largest spend share category, homewares and appliances, grew slowest at 1.5 per cent month on month, seasonally adjusted, while grocery and liquor grew 1.2 per cent in the month. This category is approximately 17.8 per cent larger than it was in the same period in 2018.

In month-on-month terms, all states and territories except Tasmania recorded sales growth, an exact reversal of overall retail sales in December. Queensland and the ACT grew fastest in the month, though Victoria, which had a much slower sales month, still leads in year-on-year terms.

In year-on-year terms, the Index was up 13.3 per cent year on year, seasonally adjusted, in December, and it continues to outpace the broader ABS retail sales series. 

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