Christmas Prospects 2009 in Britain and France - The End of Frugality Fatigue©

A study for Kelkoo, Europe's largest e-commerce website, on the prospects for Christmas and the January sales this year make exciting reading.

The Centre for Retail Research, Nottingham, which carried out the survey in September 2009, found plenty of reasons to be cheerful. People were optimistic. The economy was improving. Families wanted a 'treat'. The frugality preached by the media and by others concerned to show that, whatever we do, world disaster comes ever closer, has produced frugality fatigue©. Why not have another glass of wine?

The Background

Christmas and the January sales are critically important for retailers, accounting for 23% of annual retail sales over a ten week period. A poor Christmas, as seen in 2008, led to 20 major retailers going into administration, the loss of 40,000 jobs, and shop voids rising to 10% in February 2009.

• The economy is moving out of recession
• Consumer confidence is increasing

The Forecast UK

We forecast that Christmas sales in 2009 (the 6 weeks mid-November to the end of December) will rise to £44,700 million, a year-on-year increase of £832 million.

• Last year Christmas sales fell by -£27 million
• In Christmas 2007 sales grew by +£852 million

We expect January 2010 to produce retail sales of £21,956 million (up £320 million over January 2009).

The growth in sales at Christmas and January will be £1,152 million.

• This should create about 5,000 jobs.
• Produce confidence for retailers and suppliers that the corner has been turned, which itself should preserve 50,000 jobs.

No, this does not mean that good times are here again. Consumers have learned new things and will not easily change their behaviours.

Online Spending

We forecast that online spending will reach £8,960 million this Christmas, representing 20p in every retail £1 spent. This year shoppers said that 72% intended to use online retailers to buy goods at this Christmas (67% last year) and 38% would buy a majority of their Christmas goods online.

Online sales this Christmaswill be driven by clothing, accessories and footwear (up 17% by August this year), electrical goods (up 20% by August), and health and beauty items (up 35% to August).

January online sales will reach £4,611 million, 21% of total UK retail sales, driven mainly by clothing as sales of alcohol and gifts will fall seasonally in January.

The First Online Christmas

• The first online Christmas where 50% of Christmas purchases are made online will be December 2015 (assuming a 24% online growth rate) or 2021 (if growth is rather slower at a still-impressive 16%). Please note that this does not imply that shoppers will no longer go to high streets, simply that a large proportion will buy their toys, books, games, clothes, perfumes and cosmetics online.

Christmas Spending by Region 2009

These figures are derived from a survey of 1,4000 consumers (all ages, both sexes) by region. The highest spenders were in London (£768.60) and the South East (£706.63) and the South West (£605.89) and Wales (£619.83) spend the least.

(source: Centre for Retail Research Consumer survey)

FRANCE

French citizens are more optimistic about their economy than the British and are looking forward to Christmas and the sales. Christmas in France is less exotic and more family-focused than in the UK. People spend rather less.

Forecast

No one is expecting miracles, but Christmas sales of €72,369 million (up €1,206 million), rather less than the sales increase in Christmas 2007 (+€2,255 million) but a great improvement on 2008 increase of €301 million.

In January 2010, we expect retail sales of €34,854 million, an increase of €781 million over last year.

Online Spending

We expect online spending in France to reach €7,599 million this Christmas, representing 10¢ every retail euro €1 spent. This year shoppers said that 69% intended to use online retailers to buy goods at this Christmas (64% last year) and 12% expected they would buy a majority of their Christmas goods online.

Online sales this Christmas will be driven by clothing and textiles, electronic items and electrical goods, and sales of books, CDs and DVDs, all of which have been growing strongly during 2008 and 2009. The small but fastest-growing category will probably be items for the home.

Le Premier Noël Français en Ligne

At slightly less than current rates of online growth (22%) e-commerce retailers will be responsible for more than one-quarter (28.4%) of Christmas goods by 2015 and perhaps one-half by 2021.

THE GLOBAL RETAIL THEFT BAROMETER 2009

The Global Retail Theft Barometer 2009 (GRTB2009) has now been published and a summary of the results can be found here

http://www.retailresearch.org/global_theft_baromter/2009keyfindings.php

THE STORE OF THE FUTURE 2012-15

Centre for Retail Research on the role of the Store of the Future in an online and digital world (commissioned by Visa Europe) based on research in seven European countries can be found here.

Retail Ethics and Green Retailing 2007: More than plastic bags?

There is a plethora of green announcements by retailers, all keen to show they are environmentally conscious. The future of UK retailing - for the moment at least - is green and very heartwarming.

Every major supermarket trumpets its green credentials, its healthy eating range, its policies to combat carbon emissions and reduce waste, and the ethical producers it uses.

• This season, People Tree became the first UK fashion house to gain both Fairtrade and Soil Association accreditation.
• Oasis, Topshop, Tesco and Marks & Spencer stock organic and Fairtrade collections.
• The Co-op has majored on Fairtrade products for some years and its own-brand black chocolate and own-brand coffee is exclusively Fairtrade.

Points to watch.

• Customers and green organisations will be anxious to see that retailers carry out all their promises and will rub their noses in it if any are unfulfilled.
• Expect greater regulations - from the UK or the EU - which will make what now seem far-sighted approaches obligatory. Let's think what 2012 will look like and what the regulations will be like then! Expect a lot of fuss about all this.
• Customers will expect environmental transparency - "prove your eggs are actually free range" "prove your sweaters are not produced by slave labour" and expect the internet to be used a great deal by savvy suppliers to prove this.
• We all love small shops (well, not all the time) but expect the multiples to be faster and more informative about this than smaller retailers.
• There will be new environmentally-friendly retailers who will set up their stalls on the moral high ground. In a year or two, they may find it tough going against UK multiples on a mission.
• Getting into bed with Greenpeace and Friends of the Earth will prove to be a t-e-r-r-I-b-l-e mistake and retailers will find they will be eaten alive by these characters.

Download the full report (PDF) Here

Cheque Use and Payment Systems in UK Retailing

Centre for Retail Research work to investigate the major trends in payment systems used in retailing and the actual costs that payments systems impose upon retailers can be found here

The main results from the CRR report on Black and Minority Ethnic Retailers, sponsored by ATL Yorkshire, can be found here

WHAT SOCIETY PAYS FOR CRIME AGAINST SHOPS 2005

The total costs of crime to retailers and the public are shown here

FEMALE OFFENDERS

Women may be the dominant sex on the High Street, but it is men who love going down the aisle for the wrong reasons, according to our latest in-depth retail crime research. More information here