Australia: Online Retail Sales Index rebounded strongly in January - NAB

Analysts at NAB note that NAB’s Online Retail Sales Index (NORSI) rebounded strongly in January (+1.5% mom s.a.) for Australian economy from a revised contraction (-1.8%) in December.

Key Quotes

“While volatility in online retail sales growth appeared to have settled in 2016, over the past year it has re-emerged. Year-on-year growth was also stronger in January, with sales up 14.1% compared to last year. Trend online retail sales is still much stronger than the early months of 2017.”

“ABS data on traditional retailers showed month on month seasonally adjusted sales contracted (-0.5%) in December. Traditional sales were not as weak as NORSI in that month.”

“We estimate that Australian consumers have spent around $24.7 billion over the 12 months to January 2018. This is equivalent to 7.9% of spending at traditional bricks & mortar retailers, as measured by the ABS in the 12 months to December 2017.”

“Most categories accelerated in January (yoy), with Toys and Games (20.9% yoy January vs 15.3% yoy December), and Department stores (20.9% vs 12.6%) both leading along with the much larger sales category of Media (20.4% vs 19.0%). Grocery and Liquor (16.2% vs 6.5%), Food Catering (14.4% vs 18.8%), and Daily Deals also recorded double digit growth, albeit with the latter two categories slowing. More mild growth was recorded in January for Fashion (9.9% vs 7.8%) and the largest sales category Homeware and Appliances (8.8% vs 5.5%), with a slowdown for Personal and Recreational (8.4% vs 12.2%).”

“SME sales represent just over a third of all online sales. Seasonally adjusted SME sales (3.2%,mom s.a.) accelerated more than large online retailers in January.”