UK retail sales set to grow 2.5 percent during December

UK retail sales are expected to reach 42.2 billion pounds in December, an increase of 2.5 percent, according to new research from Mintel, as more than one in five consumers plan to shop more online in the lead-up to the festive season.

Mintel states that while there will be growth, consumers will still be seeking out bargains this festive season, with almost a quarter (23 percent) of UK consumers planning to put off making big purchases until they have seen the Black Friday and Cyber Monday promotions. In 2015, 20 percent of UK shoppers bought gifts online and 11 percent bought in-store on these promotional sales periods.

Research also found that of those who purchased on Black Friday or Cyber Monday, 55 percent bought things that they would normally have waited to buy in the January sales and 26 percent held off spending ahead of the Black Friday and Cyber Monday promotions.

In addition, Mintel found that almost three in five (58 percent) of UK gift buyers agree that promotions available mean that they don’t need to pay full price for gifts, rising to 63 percent of women, compared to 53 percent of men.

Mintel predicts 2.5 percent growth in retail sales in run-up to Christmas

This year more consumers plan to avoid the high street crowds by turning to online retail, with around 20 percent of consumers say they will shop more online during the lead-up to Christmas with this figure rising to 24 percent of men and 28 percent of 18-24-year-olds.

The top three reasons cited by consumers for turning to the internet were cheaper prices (55 percent), avoiding the crowds (49 percent) and shopping when it suited them (49 percent).

Director of research at Mintel Richard Perks said: “The economic background for consumers continues to be favourable. Real incomes are rising and unemployment is falling. There are some worrying signs though. Consumer credit has risen back to record levels and the housing market has weakened a little but overall, the prospects for Christmas remain good.

“When it comes to Christmas shopping, it is increasingly artificial to make a distinction between online and in-store as the two increasingly are working together to suit shoppers’ needs. We are seeing pure players recognise the advantages to having a physical offering, signified by Amazon and Zalando’s interest in moving to the high street. At the same time, a number of high street retailers now price match against online retailers, trying to fight back against the continued belief among shoppers that it’s cheaper to buy online.”

Overall last year, 93 percent of British consumers bought gifts for Christmas, some 86 percent bought gifts in-store and 76 percent purchased online. Just under one in ten (8 percent) bought all of their Christmas gifts online, compared to one in five (18 percent) who bought all of their Christmas gifts in-store.

Perks added: “December 2016’s results will very much depend on what retailers do about Black Friday, but if they cut back on such promotions then there will be a knock-on benefit to December, as sales roll over into this month. In 2015, December’s results were weak, partly because of Black Friday and partly because of the unseasonal weather, which seems to have been a constant story over the last year. So the comparisons this Christmas are easier.”

Image: courtesy of John Lewis