Despite UK online retail sales slipping to their lowest year-on-year (YOY) growth in 2018 this July, with most categories seeing declines, the hot summer boosted garden sales, delivering a record 22.4% YOY increase last month.

The uplift in July built on garden’s staggering +49.9% YoY growth in June, according to the latest IMRG Capgemini e-Retail Sales Index.

IMRG strategy and insight director Andy Mulcahy said: “The British weather is often the cause of much misery or joy for British retail, and July was no different. The main beneficiary of the prolonged heatwave in July was the garden sector, with 22.4% year-on-year growth, which is in contrast with recent difficulties experienced by some on the high street. Shoppers keen to capitalise on the sunshine focused their attention on gardening products – which was also to the detriment of the home sector, which reported a year-on-year decrease of 5.8%. The positive weather, which started in May, has transformed the garden sector’s 2018 performance into an impressive 24.5% year-to-date growth.”

However, it was less positive across the board, with online retail sales falling to their growth in 2018 so far this July, as consumer spending slumped in the weeks following England’s FIFA World Cup exit.

Online sales increased by just +10.0% (YoY) in July, well below the three, six and 12- month rolling averages of +14.7%, +15.0% and +12.7% respectively.

Online retail enjoyed record growth in the first half of 2018, and this looked set to continue after the first week of July, with sales up by +14.4% (YoY). After England’s semi-final exit on 11 July, however, this took a dramatic turn, and even Amazon Prime Day could not prevent growth shrinking  to +3.7%, +8.6% and +5.1% in the remaining weeks of the month.

The clothing sector appeared most affected by the slump, experiencing its lowest YoY growth (+7.5%) of the year, which was also below the 5-year average of 11.8% This incorporated the most significant decreases seen in footwear (-30.6% YoY) and Accessories (-13.4% YoY) since 2013

Capgemini principal consultant in retail customer engagement Bhavesh Unadkat: “A few factors contributed to the fall in online customer spending this month, but significantly last July saw a peak in conversion rate due to activity around Prime day – something that was not repeated this year. Combined with the decrease in overall site views and the highest increase in July basket value in over five years, it suggests that retailers have had to focus less on discounting and clearance; an effect of lower price-points throughout the year due to the competitive nature of the high street combined with good weather driving early summer spending.

“This month’s slowdown could also serve as a reality check for the outlook ahead. GFK has reported a decline in consumer confidence Index this month, and the Major Purchase Index decreased two points to -2. The interest rate hike could also impact the amount of disposable income people have to spend, while consumers are being more cautious after high credit card spend over the summer. After the boost from this summer’s sunshine and events, retailers need to focus hard on winning the battle for spend and share of wallet, as H2 will be highly competitive with a less transactions ringing through the ‘online’ tills.”