Discounting is set to reach record rates before Christmas; standard delivery coming to an end pre-Christmas; while shoppers are set to head for the high street this weekend
Pre-Christmas discounting peaks
Retailers are cutting prices in the run up to Christmas – and new analysis predicts that discounts could reach a record average of 48% by Christmas Eve.
Currently the average discount offered is coming in at 43.6%, according to Deloitte’s analysis of more than 800,000 products. That’s more than 0.3% greater than the discounts that were on offer two years ago. Actual prices are spread over a range that varies from a discount of less than 2% to more than 80%. From Boxing Day, the average discount is set to reach more than 52%.
It’s caused, says Deloitte, by an over-supply of unwanted stock following mild weather, economic uncertainty and varying levels of success around Black Friday and other discount events.
In recent years, consumers have come to expect retailers to heavily discount products in the lead up to Christmas,” said Jason Gordon, lead consumer analytics partner at Deloitte.
“Christmas falling on a Tuesday, shorter Sunday opening hours and many choosing the weekend prior to Christmas to travel to friends or family will complicate the last few crucial days trading. This is why we expect retailers to ramp up their discounting earlier than normal in an attempt to clear stock.
“On the one hand, deeper discounting is clearly good news for consumers, but at the same time retailers are seeing margins eroded, significantly for some, at a time when sales volumes should be peaking. Against a backdrop of considerable business uncertainty across the sector, many retailers will extend their Christmas sales deep into January, with some having little option but to run through early February and even beyond. While this is unprecedented, it will not be a surprise.”
Last standard posting day
Tomorrow marks the last day that many retailers are offering standard delivery at a standard rate in order to get it before Christmas – although some are already calling time on that option today.
After that, the cost of buying online is set to rise as shoppers will need to pay for premium delivery in order to get their items delivered in time for Christmas. So what are the leading retailers doing? We took a look at the Elite retailers from our listing of IRUK Top500 retailers to see what delivery options the top-performing retailers are offering this Christmas.
Thursday December 20 is the last day for free delivery – for orders placed by 11.59pm, Friday December 21 is the last day for standard delivery, Sunday December 23 is the last day for one-day delivery, while shoppers buying on December 24 can, in selected areas, get their last-minute orders via same-day evening delivery, or Prime Now two-hour delivery.
Having invested heavily in in-store collection points alongside fast delivery, the Argos website is promoting its free click and collect service – from its own stores and branches of Sainsbury’s – and same-day delivery (items bought by 6pm are delivered by 10pm for £3.95. Large items are delivered next-day or on a nominated day, while Tu clothing is delivered next-day for £3.95 or via free click and collect.
The health and beauty business is playing safe with its delivery offer: orders must be in by 7pm Wednesday December 19 in order to be delivered to the home via its free standard delivery service before Christmas. The final day using its next-day delivery service is Thursday December 20 – when orders must be in by 7pm.
The retailer is still promoting its next-day Order & Collect – for orders placed by 8pm for collection from 12 noon – with no apparent cut off date over Christmas.
At M&S, last order dates depend on the category. The cut off for standard delivery (£3.50, or free for orders over £50) of clothing, home and beauty orders is 10pm on Tuesday, while shoppers have until 5pm on Saturday December 22 to order for either home collection or use the premium nominated-day delivery service (£3.99). Flowers can be ordered for nominated day delivery by 12pm on Sunday December 23, while the standard delivery deadline has already passed for wine, hampers and furniture – though they can all still be ordered for named day delivery by Friday December 21 (wine and hampers) or Saturday December 22 (furniture). Christmas food orders had to be in by December 15 for store collection.
The sale is already in full-flow at screwfix.com. Those wanting to get their items delivered for Christmas can use click and collect to pick up in as little as a minute, or order by 4pm on Sunday December 23 for next-day delivery, which is free for orders over £50.
Grocery deliveries from the final two Elite retailers, Tesco and Asda, depend on local delivery slots being available. Asda says on its front page that it still has slots available. In my local area, Asda only had available slots for delivery on December 20, although click and collect was still potentially available.
Last-minute spending set to peak this weekend
Some 10.1m shoppers will spend £2.38m a second in-store on the last Saturday before Christmas – adding up to £1.38bn, according to predictions from VoucherCodes.co.uk and the Centre for Retail Research. Meanwhile, 4.8m online shoppers will spend £268m that day, December 22.
That follows on from a Friday on which, the two predict, 10.3m shoppers will collectively spend £907m in-store, while 7.2m people will spend £321m online.
Food will top the list of purchases, according to this analysis, with 27% of 2,003 UK adults surveyed saying that they’d be spending on groceries, and 17% on clothing, footwear and accessories. Last minute gifts are are expected to include chocolates (cited by 26%), perfume (25%), clothes (25%) and gift cards and vouchers (21%).
Jimmy New, director of marketing at VoucherCodes.co.uk, said: “Super Saturday will be a big shopping day for both retailers and consumers alike as millions flock to stores looking to snap up last minute gifts and other essentials before Christmas Day. It’ll certainly be one of the busiest shopping days on the high street, so if you do brave the shops expect crowds.”
Meanwhile, retail intelligence specialist ShopperTrak says UK shopper traffic is expected to rise by 20% on the daily average on Friday, as Christmas shoppers head to the High Street to finish off buying festive gifts.
Steve Richardson, UK and MEA Director at ShopperTrak, said: “Friday is significant in that it marks the moment that shoppers move away from buying online and instead head into stores to finish off Christmas shopping. In spite of retailers offering later and later fulfilment options, shoppers will head on to the High Street, fuelled by the fear that online gifts may not arrive in time for the big day, as well as taking advantage of click-and-collect orders, which some retailers are promising to fulfil on Christmas Eve itself.”
But fellow retail intelligence business Springboard is forecasting a 3.5% drop in footfall over the coming week, compared to the same time last year. Numbers will be down, it says, on high streets (-3.2%), retail parks (-2.8%) and shopping centres (-4.8%)
It said: “This is broadly in line with the declines in footfall already seen in December this year and is significantly greater than the -1% drop in footfall in the same week last year. We are anticipating that the peak shopping day of the week will be Friday rather than Saturday when footfall will dip slightly. This is a pattern that Springboard has recorded over a number of years when Christmas day is in the first half of the week as it is this year; consumers generally use the weekend as part of the Christmas break, for travelling and for visiting family and friends.”
Last week, it said, visitor numbers were 0.1% down on last year – although in the same week last year snow and ice closed roads.
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