In a worrying sign for retailers, softness in consumer demand appears to be starting to affect online purchases.
May 2025 does not seem to have been a good month for retail. Footfall was flat and Office for National Statistics figures suggest retail sales growth is starting to slow.
That slowdown in sales momentum seems to be acutely affecting online sales, according to new data from Adobe Analytics.
Online spending in the UK dropped by 1.2% in May compared to the same month in 2024. This marks the first time that online spending has slowed on a yearly basis since October 2023. It is also the lowest month for overall online spending since May 2023. That is despite online prices being 9.6% cheaper on average than in May 2024.
The launch of the Nintendo Switch 2 brought some joy to electronics retailers. Video game, console and accessory sales in the first weekend since launch (June 5 to 9) were up by 252% on the May daily average. This tallies up with Nintendo’s reports of 3.5 million unit sales worldwide over the same period, making it the best console launch ever for the Japanese company.
“Signs of underlying softness in consumer spending power have been evident since the start of the year,” said Vivek Pandya, lead analyst at Adobe Digital Insights.
“May is always the lowest online spending month of the year due to bank holidays, school holidays and being outside of seasonal sale periods, but retailers will need to take immediate action to save their summer by quickly launching promotions and taking advantage of major sales events like Prime Day in July.”
The spending drop also hit the momentum of buy now, pay later (BNPL) services, with spending using this payment method dropping by 3.2% year on year. May 2025 had the lowest online BNPL spend, at £1.18bn, since Adobe began tracking it in January 2023.
Hot weather in May meant the fastest-growing categories related to outdoor activities, including 37% month-on-month growth in sporting goods, 29% in swimwear, 21% in activewear and 23% in sun cream.
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