According to an estimate released recently by MasterCard Advisors, online spending in March increased 16.1% year over year, the fifth straight month of double-digit growth for e‑commerce. MasterCard bases the SpendingPulse report on retail sales using all payment forms, including credit and debit cards of all brands, cash and checks.
Online apparel sales also posted a large gain in March, increasing 18.7% year over year, the 16th consecutive month of growth for the sector. By contrast, total apparel sales, which includes purchases made in bricks-and-mortar stores, increased 4.4% in March, the payment card network says. The report also notes that overall luxury sales had its sixth consecutive month of growth, up 8.5% year over year, the largest monthly gain since December of 2010. The luxury index tracks sales at high-end restaurants, grocers, department stores and general apparel categories.
Industry analysts speculate the double-digit growth and consecutive gains are being fueled in part by high gas prices as more consumers are cutting down on trips to the mall. Retail gasoline prices rose 5.00 cents from the previous week to $3.61 a gallon, an increase of 28.9% from a year earlier, driven by volatility in oil markets amid the crisis in the Middle East, the SpendingPulse report shows.
High gasoline prices could dissuade consumers from making trips to bricks-and-mortar stores, dampening retail growth. “On the other hand, we’ve seen the e‑commerce channel benefiting somewhat from this trend,” says Michael McNamara, vice president, research and analysis, for MasterCard Advisors SpendingPulse. Driving demand declined year-on-year in all U.S. regions and fell week-on-week everywhere except the Gulf Coast, which posted no change.
“Most retail sectors continued to record solid growth year-over-year, similar to February, although we’re not seeing an acceleration of momentum from February to March,” McNamara says. “The lack of increased momentum in some sectors could be due to calendar shifts, given that Easter falls very late this year.”
The January gain in online sales was the second-highest in the recent five-month surge. December 2010 e‑commerce sales grew 17.6% over December 2009, according to MasterCard.[Source: SpendingPulse report. MasterCard Advisors. 5 Apr. 2011. Web. 8 Apr. 2011.]