A Tale of Two Octobers

Friday, November 6, 2009 | 10:33 AM

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October has often been a month of economic turmoil; it is the month when both the stock market crashes of 1929 and 1987 took place. Last year, it looked like the global economy was on the precipice of financial meltdown. It was during October that various governments were forced to take shares in numerous large financial institutions.

Refreshingly, 12 months on and October appears to have passed without major incident. The banks look like they will survive, the FTSE 100 is up around 30%, and GDP is expected to be positive in the next quarter.

After a very tough year for retailers, the story seems the same. According to the CBI optimism from UK retailers is the most positive it has been in 2 years. High Street sales have grown modestly in the year to October[1].

However online retail presents a much stronger picture, and is the channel driving growth for a lot of retailers. Argos have reported that 'Check & Reserve' orders have grown 50% and represent 18% of all orders; 42% of orders are now 'multi-channel' [3]. John Lewis reports website sales growing at 29% vs 5% for the overall business for the 12 weeks ended 24th October[4]. It seems there is no stopping UK consumers embracing the internet to browse and shop for products. At Google, UK searches for popular categories such as clothing and Home Entertainment are up 36% and 26% respectively Y/Y. The charts below show how four popular categories are trending as we head into the seasonal peak. In some cases search activity is already greater than peak levels of Christmas 2008.





All this should provide some optimism for retailers on the verge of the busy Christmas trading period. As we look to the festive season, it is seems that ~30% Y/Y growth is the benchmark to set.

Amazon's recently reported third quarter results. International sales (which include UK, DE, FR & JP) were up 33% on the same period last year. The company has forecast growth next quarter to be between 21-36% compared to 2008[2].

What targets have you set for your website this Christmas? And how can you capitalise on the growth opportunity presented by online (eCommerce) over the festive period? For those new to online advertising a Google Adwords account can be set up in minutes and will allow you to place a targeted message alongside search results. Go to www.google.co.uk/Adwords to learn more.

For those already well versed in paid search advertising, Google tools such as Insights for Search can show what new terms users are searching for, and help you target your marketing activity. While the Search Based Keyword Tool can help identify gaps in your keyword coverage. Get in touch with your Google representative for more help.

[1] “UK retailers’ optimism at two-year high” Norma Cohen, FT.com, October 27 2009
[2]
Amazon Investor Relations
[3]
“Half-year results for the 26 weeks ended 29 August 2009” Home Retail Group, October 21 2009
[4[
John Lewis Partnership


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