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One of Australiaâs leading bank, National Australia Bank (ASX: NAB) has been serving around 9,000,000 customers at more than 900 locations in Australia, New Zealand and around the world. Recent on 2 April 2019, NABâs business research and insights division provided information about NAB online retail sales index for February 2019.
As per the data, the NAB Online Retail Sales Index contracted by 3.4% in February on a month-on-month basis and on Year-on-year basis it reported a growth of 0.5%. While commenting on the growth of online Retail Sales index, NAB Chief Economist, Alan Oster told that this is âworst growth rate in the series historyâ.
All categories recorded a month-on-month decline in sales, with the largest contraction in Homewares and appliances category which reported a decline of 4.5% on a month-on-month basis. While Department and variety stores are still the fastest growing category with 22% growth in year on year terms, it was the fourth worst performing category in month-on-month terms.
Mr. Alan informed that although the transaction volumes are growing, the average spend in each transaction is falling, reflecting the shift in the consumer preference to cheaper alternatives.
The Fashion category is the most impacted by the effects of buy now, pay later payment methods, as it recorded the least negative growth in the month and was virtually flat over the year. The drop in average spend on each transaction has affected some categories more than others. The biggest average spend falls in Grocery and Liquor, and Media sales and the biggest gains in average online spend per transaction was in Department stores and Takeaway food.
In year-on-year terms, Victoria and New South Wales were the only two states to record growth. Victoria reported 3.8% growth and New South Wales reported 2.3% growth. Year-on-year sales growth in Queensland was almost flat, while WA, which had been growing rapidly over the past few months, contracted by 8.2% in February. According to NAB, in the 12 months to February 2019, Australians spent $28.92 bn on online retail which is equivalent to around 9.0 percent of the traditional bricks and mortar retail sector.
NABâs definition of a domestic online retailer can include those merchants whose parent organisation might be overseas but the subsidiary has established operations in Australia. As per Alan Oster, using GST as a defining characteristic of domestic and international is no longer appropriate given goods under $1000 from overseas merchants are no longer exempt from GST.
NAB online retail sales index measures all online Retail spending by consumers which uses electronic or online payment methods to settle their transactions like payment through debit card, credit card, BPAY payments, Bank Transfers, Direct Debits and Payment through Paypal etc.
NABâs shares traded at $25.410 with a market capitalization of circa $71.27 billion as on 2 April 2019.
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