• Growth for the NAB Online Retail Sales Index contracted again in April (-1.3%), following on from a significantly revised contraction in March (-0.3%) on a month-on-month, seasonally adjusted basis.
• In year-on-year terms, the NAB Online Retail Sales Index continued to grow, accelerating in April (15.2% y/y).

• By category, results were mixed this month. Large sales categories grocery and liquor, and department stores, recorded growth, along with smaller sales categories media, and takeaway food. The largest sales category, homewares and appliances, recorded a strong contraction, along with games and toys, fashion, and personal and recreational goods. In year-on-year terms, takeaway food, grocery and liquor, and department stores lead.
• All states except SA, NT and ACT recorded a contraction in growth in month-on-month terms in April, with WA and NSW faring slightly worse than the overall. After recent weakness, TAS was close to neutral this month, with VIC and QLD slightly better relative to the overall result.
• The contraction in growth was slightly worse for metro areas in the month. However, this headline result was influenced by a significant increase in SA regional sales in April, along with weaker TAS metro sales. In year-on-year terms, growth in metro areas was slightly faster, with NSW, QLD and WA contributing heavily to the result.
• Most of the contraction in growth was recorded by domestic retailers, with international recording slight growth. Growth in April for games and toys retailers, a key share category for international, outpaced domestic in month-on-month terms. However, over the year, domestic retailers have gained share in this category.
• NAB estimates that in the 12 months to April, Australians spent $56.89 billion on online retail, a level that is around 15.1% of the total retail trade estimate (March 2022, Series 8501, Australian Bureau of Statistics), and about 19.6% higher than the 12 months to April 2021.

NAB Chief Economist, Alan Oster commented:

In month-on-month terms, our NAB Online Retail Sales Index contracted for a third consecutive month in April. Having said that, a large revision to the underlying data for March has almost netted that month’s contraction. The drop in April compares favourably with similar published series overseas, with the UK measure (BRC), for example, indicating UK online retail sales fell significantly more in the month, and contracted in year-on-year terms. Our measure in year-on-year terms accelerated.

Our broader measure of retail trade, the nab cashless retail index, suggests a continuation of relatively strong growth in April. However, there are factors likely to moderate near term growth in retail, with particular note to inflationary pressures and rising interest rates, and demand for experiences related to hospitality.

For online retail, what we observed in April, in year-on-year terms, was continued spend growth. What we also noticed this month, was that for some categories, the number of transactions did not keep pace, indicating an increase in the average spend per transaction. This was particularly the case for homewares and appliances, where year-on-year spend increased, while the volume of transactions was lower than a year prior. This resulted in a more than proportionate increase in average spend per transaction. A similar trend was observed in the fashion category. This may indicate the possibility of price rises driving sales growth.

This month in the heat map section, we take a look at the takeaway food category, and the change in growth compared to the pre-pandemic period.

Get all the insights in the NAB Online Retail Sales Index (April 2022)