Games and toys' online sales grew 0.7 per cent in June on a month-on-month, seasonally adjusted basis according to data from NAB's Online Retail Sales Index (NORSI). 

This rise follows a 1.8 per cent contraction for the sector in May. 

Overall, online retail sales contracted by 1.6 per cent in June according to NORSI. This decline follows a strong sales rise in May, with sales up 3.4 per cent in the month.

In year-on-year terms NORSI remains slightly positive, up 0.5 per cent compared to 2018. However, this result is compared to one of the strongest periods in NORSI history - January to September 2018.

Geographically, all states and territories experienced declining online sales in June apart from WA and the ACT. Tasmania experienced significant sales declines in the month, slipping 6.4 per cent. 

NAB chief economist Alan Oster said that one of the smaller categories led the rises in online sales in June.

"Our NAB Online retail sales index data indicates that sales growth was negative in June 2019, following on from strong growth in May.

"Online retail sales tend to be more volatile than broader retail, experiencing far greater monthly fluctuations.

"Looking through the month-to-month volatility, while sales growth through the year is still positive, it slowed in June and is markedly slower than the same period in 2018.

"By category, after weak sales growth earlier in the year, the small sales category of takeaway food (29.4 per cent) led both month-on-month and year-on-year growth in June.

"The headline result for June appears to be a result of sluggish growth in most categories, combined with a significant sales contraction in media (-16.5 per cent), and the largest spend category, homewares and appliances (-7.3 per cent)," he said.

NAB esitmates that in the 12 months to June, Australian consumers spent $29.32 billion on online retail. This figure represents approximately nine per cent of traditional bricks-and-mortar retail in May.

To read the full report, click here.

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