The way people shop over Black Friday and the extended Christmas period tells us far more than how people are getting on with their present shopping. The changing way that shoppers are buying becomes magnified thanks to the sheer volume of transactions at this time of year. In addition, time-pressured shoppers look for, and adopt, new ways of doing things that they may then continue over the rest of the year. With this in mind, InternetRetailing is devoting a regular twice-weekly slot to peak shopping season 2017, highlighting the stories that struck us as most interesting over the last few days. Today we’re looking ahead to the long Christmas weekend, as well as considering the impact of recent snowfall and rounding off Black Friday analysis.
Christmas predictions: from before Christmas…
More than one in four (29%) of people plan to hit the shops on Christmas Eve this year, according to the latest Accenture Holiday Shopping Survey.
Despite figures suggesting that almost half (48%) of people now shopping for festive gifts throughout the year – many of us will still be buying down to the last minute on Christmas Eve. Half of Christmas Eve shopping (49%) will be done in store as people head to the high street for a last-minute dash, while others will look for deals online.
The research also found 30% of people plan to take advantage of the Boxing Day sales, but they are more likely to find deals from the comfort of their home than to hit stores. Almost two thirds (63%) will do their Boxing Day shopping online and one in ten (12%) are likely to return Christmas gifts.
“The last-minute shopping dash is a big opportunity for retailers,” said Jill Ross, a managing director in Accenture’s UK retail practice. “To capitalise on this and drive sales, retailers could look to streamline search capabilities and curate the experience to help customers find what they are looking for, and help customers find things they don’t yet know they’re looking for.”
“Consumers are hunting down the best deals and the most thoughtful gifts across both digital and physical channels,” said Ross. “Retailers must invest in their user experience to deliver a seamless customer journey – from the first moment a customer spots your product to when it is sitting under the Christmas tree.”
• Friday and Saturday (December 22 and 23) are expected to be the two busiest shopping days of the year for the high street, according to Mastercard. The credit card company says that festive spending has grown by 3.1% this year, but that online retailers are seeing their takings lift by 12%. In-store contactless payments, meanwhile, are up by 98% on the same time last year.
Scott Abrahams, senior vice president of business development at Mastercard UK & Ireland, said: “On the whole this Christmas season will be a welcome relief for Britain’s retailers. Spending so far is up 3.1% on last year, however the real cheer will be saved for online businesses, with growth up 12% year on year. This migration from high street to online shows consumers are continuing to look for the savings that online shopping can deliver, which promotions like Black Friday have only heightened.”
…to Christmas Day and Boxing Day
IMRG [IRDX VIMR] is predicting online sales of £844m on Christmas Day – up by 6.3% on the same day in 2016, when shoppers spent £794m.
Online shopping on Boxing Day is also forecast to exceed £1bn for the first time, reaching £1.03bn, a 7.9% increase on 2016 when, says IMRG, shoppers spent £954m.
If the forecast is borne out by shopper activity over that period, it would mean that Black Friday continues to outstrip Boxing Day for online retail spend. In 2017, IMRG recorded £1.39bn spent online for that day – an 11.7% increase on Black Friday 2016.
Justin Opie, managing director, IMRG, said: “Boxing Day sales remain a fixture of retail and an important day in the calendar, but Black Friday has altered sales patterns over the full peak period and is now the primary discounting event of the season. And perhaps, as with Black Friday, we’re seeing Boxing Day spend become more online-focused. Although going out to the shops on that day has long been a British tradition, footfall was reportedly down 7.3% on Boxing Day last year; it’s likely that spend on Christmas Day is pulling some of that order volume forward as well, as shoppers have the ability to browse and buy from the sofa on mobile devices during quiet moments at home and visiting family, redeeming the huge numbers of gift cards and coupons that they receive in place of presents each year.”
Black Friday analysis
The vast majority of online retailers (84%) and high street stores (75%) offered some kind of discount over the Black Friday weekend, according to research from business adviser PwC, which says this is broadly similar to last year.
PwC has collected data on high street and online promotions over the last seven years and says that many of those retailers who offered promotions over Black Friday returned to full-price sales in the first week of December. But this was short-lived for around 10% of retailers, who relaunched promotions this week. PwC now expects more retailers to be discounting in the week before Christmas than did during the Black Friday weekend.
Lisa Hooker, consumer markets leader at PwC, said: “UK retailers were clearly keen to participate in Black Friday weekend promotions to attract the 50% of consumers who said they’d be looking to shop for bargains. Our research shows that several of the retailers that did not previously participate in Black Friday did offer some kind of promotion this year – confirming the place of the American tradition in the British shopping calendar.
“This year, however, over a third of the retailers offering discounts over the Black Friday weekend returned to full price sales the following week – true both online and in stores.
“Consumers have told us that the beginning of December is the most popular time to do their Christmas shopping, so retailers have listened and learnt to schedule their promotions to preserve margin over this critical period.
“As we rapidly approach Christmas itself, we are already seeing an uptick in promotional activity as retailers try to attract customers through their doors and clear festive stock, particularly as last week’s snow and ice put a dent on high street footfall across large parts of the country.
“Last year, 98% of the online retailers we surveyed had some kind of homepage promotion in the week before Christmas. While this year’s trend does not suggest we will reach the same levels, we are expecting to see more bargains for shoppers in the coming week, with more retailers on promotion next week than over Black Friday.”
Snowfall boosts online sales
Widespread snow and sub-zero temperatures across the UK in early December prompted an early flurry of online festive gift buying, with searches around ‘Christmas gifts’ up 12% week-on-week, according to data from commerce specialists Summit.
Martin Corcoran, head of insight at Summit [IRDX VSMT], said: “Whilst the heavy snow brought transport headaches and school closures for many, it may have delivered retailers an early Christmas present. With snowy ‘Christmas card’ scenes up and down the country, it clearly got shoppers into the festive mood and turned their thoughts to preparing for the big day, prompting a 12% week-on-week increase in searches for Christmas gifts online.”
From a logistical perspective, Corcoran suggests this surge in online demand for Christmas gifts might also be attributed to snowed-in shoppers not being able to get onto the High Street, with footfall reportedly down 22% year-on-year on Sunday (10 December) when the snow fell.
Corcoran continued: “The last time we saw such a marked impact of snow on Christmas buying behaviours was back in 2014, when there was widespread snowfall on December 7 – this caused a surge in demand for online searches for Christmas gifting in the first week of December, up 10% week-on-week, and then a decline the following week, down 15% comparatively.”
Summit found the advent of snowfall also boosted demand for winter-related products. With heavy snow covering 50% of the country, as with earlier this week, online searches for sledges typically rise by 149% and demand for snow tyres double, whilst those googling for crampons also increases by 47%. Demand for electric blankets typically hit later, with search terms for this product rising 32% the day following the snowfall.
• John Lewis [IRDX RJLW] today reported a fall in overall sales for the week to December 16, as a result of the snowfall. It said that total sales for the week reached £171.4m, down by 0.6% on the same week last year. Maggie Porteous, director, shop trade at John Lewis, said the fall came as “adverse weather and heavy snow across the country saw fewer people head outside to shop – impacting all categories.” But, she added, “trade picked up towards the end of the week”. The week of cold weather saw demand for bedding (+7.6%), heating (+281%) and a record week for men’s knitwear. Star Wars merchandise also proved popular, following the launch of The Last Jedi film.
• Sister retailer Waitrose [IRDX RWAI] said that its sales stayed flat during the week, with strong sales of “hearty food” including pies (+12%) and soup (+12%), according to Waitrose IT director Mike Sackman.