As 2016 kicks off a new year, new UK retail and online sales figures from 2015 and Christmas are rolling in from some of the major high-street names. This new data shows a number of common trends, alongside a few surprises.
The British Retail Consortium (BRC) has announced that overall, retail sales rose just 1% in December, alongside non-food items had an increase of 15.1% in December.
UK retailers took £24 billion over the Christmas period, with £114 billion over the entirety of 2015, new figures from IMRG and Capgemini show. They estimate that 27% of retail sales now take place online – alongside a prediction that ecommerce sales will rise to £126 billion in 2016 with the growth of mobile adoption. Mobile ecommerce grew by 42% throughout 2015 – with 45% of sales taking place on a mobile device in the third quarter of 2015.
But how did the big retail and ecommerce stores fare this Christmas period, and what’s the current state of retail in the UK?
John Lewis has posted results showing that like-for-like sales rose 5.1% compared to the previous year. The 6 weeks up to the 2nd of January saw a 1.2% fall in sales in-stores – but in the week after Christmas to 2nd of January, sales were up 16.2%.
Ecommerce wins again, with a 21.4% rise in online revenues. With Black Friday, distribution teams are said to have processed 18% more parcels than the previous year – equating to 5 units per second during the peak hour.
John Lewis has also specifically pointed out the success of mobile ecommerce, deeming it the fastest-growing channel. Online sales from mobile or tablet devices were up by an impressive 31%.
Click and collect sales also increased by 16% – and was the delivery choice for 1/2 of all online orders.
The performance was driven by the retailer’s online business, with sales on smartphones and tablet computers up 31%. Online sales accounted for 40% of overall sales, after in-store sales fell. Another telltale sign of the times.
Debenhams posted positive results, with like-for-like sales up by 1.8% in the seven weeks before the 9th of January.
Debenhams also joined in the ecommerce success, noting a 12.1% rise in online sales in the 19 weeks up to January. In the week leading up to Christmas, online sales increased by 36%, with Black Friday online orders rising by 1/5 – which peaked at 220 orders a minute.
The one-day promotion for Black Friday meant that sales more than quadrupled in stores. Black Friday was also notable for 46% of online sales being collected in store before Christmas – compared to 31% of online orders being collected in the first half of the year.
House of Fraser
House of Fraser posted promising results, with sales from the week of Black Friday to 2nd of January 2016 coming in with like-for-like sales up by 5.3%.
As for the now infamous Black Friday, sales were up 10% on previous year. However, what is interesting is that House of Fraser had its biggest ever online sales day – up 40% on Black Friday the previous year.
In the week up to Christmas, online sales rose by 62%, compared to a 2% increase in sales in-store. After Christmas, like-for-like sales increased by almost 7%
The buy and collect service usage increased by 22% from last year, highlighting the importance of a multichannel business that offers customers different ways to place orders.
House of Fraser’s Chief Executive Officer Nigel Oddy has said: “This year, we saw a very strong start to the key Christmas season with Black Friday being particularly strong online, with sales up 40% on the year – our biggest online day ever.
“This year, we saw a very strong start to the key Christmas season with Black Friday being particularly strong online, with sales up 40% on the year – our biggest online day ever.”
Fortnum & Mason
Fortnum & Mason posted an increase in like-for-like sales of 15% in the the 5 weeks up to the 3rd of January, which meant an annual profit of £5m – an increase of 31%. The 15th of December is recorded as the best trading day in the history of the brand.
Again, Fortnum & Mason had very promising online results – which was up 38% year-on-year. This comes after they redesigned the website, with sales of hampers rising 26% with a record number of countries it delivered to.
Tesco had a lot to prove with these new figures, but so far it looks okay. UK sales rose by 1.3% on a like-for-like basis in the six weeks before 9th of January.
Alongside the in-store efforts, more online orders were delivered on December 22nd than any other previous day.
Morrisons started selling online in early 2014, and with the latest data show that online sales were up by 100% in 9 weeks to January 3rd.
In the 9 weeks to 3 January, like-for-like which excludes fuel were up by a slightly disappointing 0.2%, with total sales falling by 1.2%.
Morrisons also had over 30 million customer transactions in the 7 days before Christmas, which is an increase of 2.6% per cent year-on-year.
Kantar Worldpanel has said that Sainsburys now accounts for 17% of all UK grocery sales, with many expecting good results this time around. Total retail sales for the third quarter were up by 0.8% excluding fuel.
The big story once again is that online grocery sales increased by 10% in the 15 weeks to 9th of January, with total orders up by a solid 15%.
Mike Coupe, Chief Executive, said:
Groceries online sales grew at nearly ten per cent and orders by 15 per cent. We had a record week in the quarter, delivering over 289,000 online orders. We now have 101 Click and Collect sites nationwide.
Our Christmas advertising campaign Mog’s Christmas Calamity was a huge success, with nearly 37 million online views and the exclusive Mog’s Christmas Calamity book topping the UK bestselling book charts for four consecutive weeks. The charitable donation from the sales of the Mog’s Christmas Calamity book and soft toy, on behalf of Sainsbury’s, Judith Kerr and HarperCollins Children’s Books totalled more than £1.5m and will be donated to support Save the Children’s work to improve child literacy in the UK.
Sainsburys are showing the power of having a multichannel business, and how a creative marketing campaign can really impact sales and brand image.
Aldi experienced an increase in sales up by 13.3%. However, they’re still chasing Lidl, who experienced a 18.5% increase in sales in the 12 weeks to 3rd of January, becoming the UK’s fastest growing grocer. These results will certainly worry the more established supermarket chains.
The big news, however, is that Aldi is now going to move into the ecommerce space, announcing that online shopping is coming.
Next posted expected disappointing results – with retail store sales falling by 0.5% between the 26th of October and the 24th of December.
But the Directory side of the business, including online sales, was up by 2% – which meant overall sales were up by 0.4% for the period.
Argos experienced a fall in sales, having previously warned investors. Argos experienced a 2.2% fall in like-for-like sales in the 18 weeks up to the 2nd of January.
In-store sales fell by 13% during December. Despite this, there was a 10% growth in digital sales – which shows that betting on ecommerce was a good bet for the high-street brand.
Jigsaw, a luxury British fashion brand, saw a 19% increase in sales over Christmas – with a 12% increase in like-for-like sales in the five weeks to 2nd of January. Online sales increased by 31% year-on-year.
Mobile and tablet sales exceeded those placed on desktops after launching a new website – with mobile transactions rising by a huge 115%.
Burberry also experienced great digital results, with online sales outperforming retail. Burberry experienced a 1% rise in retail revenues to £603m in the three months up to December 31st.
Most traffic to the Burberry website was via mobile devices, with conversions via mobile up year-on-year after investing in the mobile platform.
As for Ecommerce retailers, ASOS experienced group revenue of £459.7m in four months ending December 31st – which is 27% up on last year.
ASOS also experienced a growth in average order frequency, basket value, number of orders, alongside a surge in active customer growth by 18%.
AO.com, an online appliance retailer, also posted positive festive ecommerce results. Revenue from the site rose by 35% in three months to December 2015.
Majestic Wine is introducing a multichannel transformation strategy, with positive results so far, as total sales increased by up 42.6% in 10 weeks between October and January.
This new strategy aims to simplify pricing, whilst making customer experiences in-store and online more convenient. And this data shows catering to customers can have a big impact.
Another ecommerce success – Boohoo.com, a womens fashion ecommerce retailer, posted results that include an increase of 45% in sales – accounting for 73.7m in revenue.
Overall, new trends show that shopper’s are often researching products online, ensuring they get the best value for money. Whether conversions are done on or offline, there’s no doubt that it’s becoming commonplace to at least research online, or even opt for click-and-collect services. It’s all down to offering customers the best possible price, quality, and convenience factor that benefits them.
These new figures show that ecommerce is on the rise, and mobile devices are truly set to takeover the online shopping experience. Whilst customers are still happy to pop in-store to collect products they need, being able to browse and order online is a huge convenience much of the UK public has come to appreciate.
For success in 2016, ecommerce retailers will need to look ahead with a mobile responsive website that offers a convenient shopping experience. Digital marketing is also more important than ever, with more ecommerce brands marketing to online shoppers than ever before. The need to remain competitive and market to potential customers on the web is paramount to online success.