Online sales, November 2020 - Supplementary COVID-19 analysis

To enhance the understanding of the economic impacts of COVID-19, additional analysis of online sales in the retail series was undertaken.

Released
11/01/2021

The Retail Trade survey has been collecting online sales since the March quarter 2013. The Online series is published as grouped industry split; a Food group (including the Food retailing, and Cafes, restaurants and takeaway food services), and a Non-food group (all other industries). Due to the limitations of online data collection, a finer split by industry is not possible at this stage. 

Online sales have become increasingly popular during the coronavirus pandemic. Restrictions placed on the operation of physical retail stores saw both businesses and consumers turn to online retailing. 

It is worth noting that retailers have had to adapt sales channels very quickly during the pandemic, and it is possible that the value of online purchases has been under-reported since April 2020. Importantly, total retail sales will not be under-reported.

The Online series remains experimental, and caution should be used in interpreting the results, especially during this volatile period. 

Total online retail

The total online series fell 0.9% in seasonally adjusted month-on-month terms in November 2020, following a fall of 0.1% in October, and a fall of 2.0% in September 2020. 

Despite the minor falls in seasonally adjusted terms, the series has maintained a new level following large rises in March and April 2020, as consumers turned to online shopping as a way of complying with regulations introduced to encourage social distancing. Stage 3 and 4 restrictions in Victoria saw closures of stores in August, especially in Melbourne, and this led to a further rise in online sales in August. 

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In through-the-year terms, the seasonally adjusted series rose 67.8% in November 2020 compared to November 2019. In the 12 months from March 2019 to February 2020, total online sales averaged annual growth of 14.4%. Coinciding with the shift to online purchasing at the outset of the COVID-19 pandemic in Australia, total online sales has averaged an annual rise of 67.1% from March to November 2020. 

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Food and Non-food

The seasonally adjusted level of online sales for the Food group fell 6.0% month-on-month in November 2020, while Non-food saw a rise of 1.1%. 

The fall for Food online sales coincided with the easing of restrictions in metropolitan Melbourne in late October, and follows large rises in July and August when Victoria entered lockdown.

For Non-food sales, the 1.1% rise in seasonally adjusted terms comes from a rise of $505.8m (22.3%) in original terms from October to November 2020. The scale of this rise is now part of regular seasonality, as Black Friday becomes established in the Australian retail calendar.  

In 2020, Non-food online sales have been trading at elevated levels. In seasonally adjusted terms, sales remain up 68.9% ($919.7m) compared to November 2019. 

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As a proportion of total grouped industry turnover, Non-food online sales were 16.8% of total Non-food sales in November 2020, in original terms. 

Despite the large increase in Non-food online sales, the proportions were largely unchanged from October (16.6%). This is due to a large rise in in-store sales, as shoppers returned to stores in metropolitan Melbourne after restrictions were eased at the end of October. Non-food online sales have remained at largely the same proportion since September, and continue to be lower than the proportion recorded earlier in the pandemic. 

The proportion of total Food sales made online was 5.2% in November. Food online sales made up 5.3% of total Food sales in October. Despite the large fall in Food online sales, in-store food sales also fell, largely driven by Supermarkets, as restrictions on hospitality were eased in metropolitan Melbourne late October.

Total online sales were 11.0% of total sales in November. This is a slight rise  from 10.4% in October 2020, however is a larger proportion when compared to November 2019 (7.2%).  

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Changes to the online series

The data was previously published as an experimental series, in original data only, as an Appendix to the Retail Trade publication. It was disaggregated by whether the retailer was "Pure-play" (online only) or "Multi-channel" (mix of online and physical stores). 

Over time, the split between Pure-play and Multi-channel remained stable, with Pure-play online retailers averaging 38.3% of total online sales. 

In November 2020, Pure-play retailers made up 35.7% of online sales and 3.9% of total sales. Online sales for multi-channel retailers made up 7.1% of total retail sales. 

The online series continues to use the same source data, and represents purchases made via the internet from employing retail businesses who predominately sell to households. The series excludes direct imports (e.g. purchased directly from an overseas website) and sales from 'households-to-households' through third party websites for example. More information can be found in the information paper Measurement of Online Retail Trade in Macroeconomics (cat. no. 8501.0.55.007).

Seasonal adjustment has been calculated for the new series using the concurrent seasonal adjustment method, meaning that seasonal factors are re-estimated each time a new data point becomes available. Unusual real-world events, such as COVID-19, can distort estimates calculated using the method. Like the total retail series, trend cannot be calculated due to the volatility of the retail series during COVID-19.