Each year, InternetRetailing has an in-depth focus on the peak trading period. In part, that’s because it is the most important time of the financial year for many UK retailers. It’s also because shopping takes place at higher volumes in the run up to Christmas, meaning that any changes in customer behaviour are seen more clearly.
Spending in the week running up to Christmas expected to peak tomorrow
Just over £1bn is set to be spent in-store tomorrow, according to VoucherCodes. Its analysis, produced with GlobalData, suggests December 21 will be the big-spending day of this week, as shoppers part with a forecast £1.6bn, of which £1.03bn will be spent in stores as 10.9m people head to the high street. A further 5m people are expected to shop online, spending £0.57bn, according to estimates from VoucherCodes’ Shopping for Christmas: the build up to Christmas report. However, the figure is forecast to be 2.5% lower than last year, primarily as shoppers spend less in-store (-20.8%).
Over the course of today (December 20), VoucherCodes expects sales to reach £1.26bn – 7.4% less than the same day last year. The forecast estimates 16.7m people will buy, of whom 11.4m will buy in-store, spending £0.81bn, while online sales will grow by 32.4% to £0.45bn.
Maureen McDonagh, SVP international and managing director at VoucherCodes.co.uk, says: “It’s disappointing that retail sales are down this year especially as the last few years have also been particularly tough for retailers.
“However, there are ways retailers can make the most of the customers who are willing to part with their cash. Consumers are looking for ways to make their money go further so retailers should show they offer value by ensuring all customers are educated about any loyalty programmes, and that deals and discounts are front-of-focus.”
Shoppers stay at home amid rail strikes and cold weather
Cold weather and rail strikes kept shoppers at home last week according to Springboard footfall figures. The data suggests that footfall last week was down both on last year (-0.9%), on the same time in 2019 (-20.1%) as well as on the previous week (-4.6%).
High streets (-10.2% week on week) were hardest hit – with footfall down by 15.7% on the previous week during the rail strikes on Tuesday and Wednesday, and more so in Central London (-31%). Footfall was up, week on week, at shopping centres (+0.8%) and retail parks (+1.6%), but footfall at both was lower than in the same week in pre-pandemic 2019 (shopping centres -24.8%, retail parks -9.8%).
Diane Wehrle, insights director at Springboard, says: “Last week – the week prior to Christmas – should have been a peak trading week for retail destinations and stores, with footfall expected to rise from the week before as Christmas shopping moves towards its zenith. Instead, footfall across UK retail destinations took a tumble last week. Whilst the cold weather prevailed, which would undoubtedly have had some impact, the contrast with the results for the week before clearly demonstrate that it was the rail strikes that were the key impact on footfall.
“By far the hardest hit of the three key destination types were high streets, which lost both shoppers who couldn’t reach towns and cities by rail, but also employees who chose to work at home last week. Some of this footfall migrated to retail parks and shopping centres, with both recording rises from the week before (albeit modest) versus a significant drop in footfall in high streets. Retail parks fared the best of all three destination types, supported by the fact they can be easily accessed by car with the bonus of free car parking.
“Across the range of towns and cities Central London, with its proportionately greater reliance on public transport and a significant working population, was by far the hardest hit. It was followed by historic towns, where narrow roads would have resulted in significant congestion deterring some visitors who weren’t able to arrive by rail. It was evident that many shoppers stayed local last week, with only a modest drop in footfall in market towns.”
Online retailers call time on Christmas deliveries
Many retailers are now past their final pre-Christmas delivery dates, with strike action and last week’s bad weather among the factors causing them to name earlier final ordering dates than in previous years.
ParcelHero’s head of consumer research David Jinks says: “From Ann Summers to Waterstones, many of the UK’s leading retailers have decided to call it quits on Christmas deliveries already. Even before Arctic conditions hit the UK, deliveries were backing up. Retailers and individuals have all been switching to couriers to avoid the impact of industrial action in the traditional postal network, and this unexpected extra volume of parcels has taken some courier networks by surprise.
“Rather than disappoint customers, some of Britain’s best-loved stores have faced the problems head-on and they are no longer saying they can deliver in time for Christmas.” He also cites M&S clothing, The Body Shop, Paul Smith, Pets at Home and The Conran Shop as no longer offering on-time for Christmas delivery. It’s last orders for Christmas today at stores including Harrods, Harvey Nichols and Superdry.
“In addition,” says Jinks, “a significant number of stores stop taking their final Christmas orders on Wednesday December 21. These include Boden, Gap, House of Fraser, New Look and The White Company.
“Retailers have had to react quickly to the escalating issues in the delivery network. For example, back in November, Harvey Nichols gave a deadline of 23 December for final orders; now its last order date is today. This is a far more sensible approach than some other stores, which still don’t include final Christmas cut-off dates on their websites, leaving customers to order in hope.
“It’s not only the impact of the strike in the traditional postal industry that has created knock-on delays. There was already a shortage of seasonal staff such as delivery drivers and warehouse workers following Brexit. It’s fortunate that the Amazon strike called at its Coventry distribution centre is not expected to take place until the New Year, or there would be a lot of disappointed faces on Christmas Day around the UK.”
ParcelHero’s Christmas delivery date checker is here.
John Lewis gives shoppers more time to order online
John Lewis, however, is going in the opposite direction – by moving its final Christmas online delivery date forward to December 22 for next-day delivery, amid “steady” levels of orders. Shoppers can also order via click and collect until midday on December 23 for next-day collection from more than 360 branches of John Lewis and Waitrose. The news comes as John Lewis sees its biggest ever number of click and collect orders – the number of parcels processed on both Sunday December 18th and Monday December 19 were up 25% on last year. Footfall in stores was also up by 26% last week compared to the same time last year.
Pippa Wicks, executive director for John Lewis, says: “While some retailers closed their delivery windows early, we’ve been able to extend ours even closer to Christmas – which is great news for all those last minute shoppers.
“Our teams are working flat out to guarantee customers’ deliveries before Christmas and, while we have great capacity, slots are limited so book soon to avoid disappointment.”
John Lewis also has its longest ever returns period in place, with items purchased on or since September 27 2022 eligible for refunds until January 28 2023.