A Pig, a Banana and an Alien. What do they all have in common? They are all stars of the first ‘big’ Christmas adverts to hit our screens this year.
With major retailers ‘pressing the Christmas button’ on their campaigns much earlier than in previous years. It’s clear that retailers want to capitalise on consumer sentiment ‘to start the Christmas shopping early’ with a raising concern that supply chain issues will challenge stock availability. The consumer also has a need to experience a more ‘typical’ consumer centric Christmas, which was significantly cut back due to the national lockdown and social distancing measures last year.
Despite the obvious challenges, Christmas 2020 was as positive as it could be. The average consumer spend in preparation for the ‘big day’ was an average spend of £395 per consumer. Unsurprisingly families and young adults spent on average more than this (and the previous year as well). Online sales in 2020 had to shoulder a heavy burden due to high demand from consumers wanting to avoid the ‘socially distanced crowds.
Has physical footfall actually increased this year? How did high street footfall fare in October? For an accurate view the BRC have tracked footfall versus 2019, and whilst the UK is performing well versus other European nations, total footfall is down 13.7% which is a 3% improvement on the previous 3-month average. Compare this to Spain (-19.8%), Germany (-26.1%), Italy (-34.6%) and France (-34.9%). Is the UK retail economy recovering quicker than the rest of Europe?
To confirm this, you’d have to understand the level of turnover and profitability that’s been achieved on a nation-by-nation (and retailer) perspective. KPMG have recently reported that total UK retail sales increased by 1.3% in October versus last year.
For those of you that have been on major high streets, or regional mega-malls recently, it certainly ‘feels’ busier than ever in the last week. As the online sales share of total retail sales, falls to approximately 42% this means physical retail is growing. Will November retail sales get close to pre-pandemic levels?
Do retailers need to be worried? What can we expect from a stock availability or promotions perspective? With Black Friday sales coming up will retailers sacrifice margin for cash sales?
With 6 weeks to go before we’ll know if Christmas 2021 has been a great success. Will The Golden Quarter of 2021 save the year? How much do retailers have riding on the riches it may bring?
To answer that we’ll find out in 2022.
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