Online fashion sales grew 2.5% in August, following a 2.3% decline in July according to new data from NAB.
All eight categories the NAB Online Retail Sales Index (NORSI) tracks experienced growth in the month, with department stores also increasing by 5.3% on a month-on-month seasonally adjusted (mom, s/a) basis.
Overall, NORSI returned to strong growth in August growing by 5.7% on a month-on-month seasonally adjusted (mom, s/a) basis.
This increase follows declines in July (-2.0%) and June (-1.8%) on mom, s/a basis.
In year-on-year terms NORSI also rebounded 8.3% in August.
NAB chief economist Alan Oster said that regional areas of Australia outpaced metropolitan areas in August.
"Our NAB NORSI data indicates that sales growth rebounded strongly and returned to positive territory in August after two weak months prior.
"Online retail sales tend to be more volatile than broader retail, experiencing far greater monthly fluctuations, but the past five months have been considerably more so.
"Looking through the month-to-month volatility, sales growth in year-on-year terms returned to close to double digits and 12-months-to August growth remains strong.
"The acceleration in sales growth does not appear to be borne out in the latest result for the broader cashless retail measure, which indicates that broader retail sales growth for August were more subdued when compared to online retail.
"Of the large sales states, Victoria leads in year-on-year growth (+9.9%), while Tasmania recorded a considerably strong rebound after months of persistent weakness to lead monthly online sales growth in August (+15.3% mom, s/a).
"Online sales growth in Victoria on average has been higher than NSW over the past couple of years. Consequently, the gap in spend share between the two is narrowing.
"Representing about one-third of all online sales, regional areas recorded the stronger growth in August relative to metropolitan regions.
"The large sales states of NSW, Victoria and Queensland were the key drivers of the strong regional result, while sales growth was stronger in metro areas in WA, SA and Tasmania.
"By merchant location, domestic retailers (+6.2%) grew strongly in the month following a contraction in July. International retailers grew at a relatively slower rate after outpacing domestic last month," he said.
NAB estimates in the 12 months to August Australians spent $29.53 billion on online retail, a level that is around 9.1% of the traditional bricks and mortar retail sector (July 2019, ABS) and about 10.6% higher than the 12 months to August 2018.