Stuart O'Brien, Author at The Retail & Hospitality Design Forum
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Stuart O'Brien

High-Street

Retail sales continue to disappoint, says CBI

Latest figures from the CBI will do nothing to alleviate High Street retailers’ concerns, with the volume of sales flat in the year to April.

The survey of 100 firms showed that, in the year to April, retail sales volumes were broadly unchanged. Sales were below average for the time of year for the second month in a row, albeit at to a lesser extent than in the year to March. Meanwhile, orders placed on suppliers fell slightly, but are expected to pick up again in the year to May.

Within the retail sector, falls in sales volumes in the clothing, footwear & leather, non-store, and furniture & carpets sub-sectors were offset by sales growth among grocers, hardware & DIY, and recreational goods stores.

Looking ahead to May, retailers expect sales and orders with suppliers to grow at around average pace.

Year-on-year retail internet sales growth picked up in April after having risen at the slowest pace since 2009 in the year to March. Retailers expect a further acceleration in internet sales growth in the year to May.

Meanwhile, wholesalers saw a pick-up in sales volumes growth in the year to April, while motor traders reported a fall in sales volumes (against expectations of continued growth).

Looking at economic growth more broadly, momentum is expected to remain tepid through this year, with the economy growing at a similar pace to last year.

Anna Leach, CBI Head of Economic Intelligence, said: “Sales have continued to disappoint in April, after falling in March. But expectations for next month are looking a little healthier.

“It’s no secret that UK High Streets have endured tough trading conditions in recent months, with some big names closing or cutting back. Much of this reflects ongoing structural changes in the sector as well as the continued squeeze on households’ real incomes. While conditions have improved for households recently – with real wage growth inching into positive territory – we expect further gains in living standards to remain modest. So the pressure looks set to stay on retailers for the time being.”

KEY FINDINGS
Retailers:
31% of retailers said that sales volumes were up in April on a year ago, whilst 33% said they were down, giving a balance of -2%. This undershot healthier expectations (+16%)
33% of respondents expect sales volumes to increase in May on a year ago with 8% expecting a decrease, giving a solid balance of +25%
30% of retailers placed more orders with suppliers than they did a year ago, whilst 35% placed fewer orders, giving a balance of -5%.
23% of retailers reported that their volume of sales for the time of year were good, whilst 32% said they were poor, giving a balance of -9%
Internet sales volumes growth accelerated in the year to April (+36%), marking a significant improvement from last month (+11%). Internet sales growth is expected to pick up further in the year to May (+50%)
Sales volumes expanded in grocers (+29%), hardware & DIY (+33%) and recreational goods (+64%). Meanwhile, sales volumes decreased in clothing (-43%), footwear & leather (-83%), furniture & carpets (-20%), and in the “non-store” sector (-19%).

Wholesalers:
48% of wholesalers reported sales volumes to be up on last year and 20% said they were down, giving a balance of +28%.

Motor traders:
15% of motor traders reported sales volumes were up on a year ago, whilst 32% said they were down, giving a balance of -16%.

 

Black Friday excitement dipped in 2017

A recent YouGov report has revealed that specific sales day events such as Black Friday and Cyber Monday saw a slowdown of engagement in 2017 for the first time since 2014, when data was initially tracked.

Some 20% of people polled said they had bought something online for themselves in 2016 and 19% had bought something as a gift; this fell to 18% and 17% respectively in 2017, indicating the fall in awareness matching the decrease in Black Friday purchases.

68% of those who shopped during sales days in 2016 said they did so either at the same level or even less last time around, indicating a drop in the excitement over sales days.

The data collected by the research suggests that better engagement with 18-24-year olds could be the key to renewed growth with sales days, with awareness coming from online promotion (61% compared to 50%) along with cinema (24% compared to 13%).

More efficient delivery methods were also key to the long-term success of sales days. Data found that almost half of those interacting with sales days in 2017 encountered issues with the availability of items (28%) long delivery times (16%) or technical issues (10%).

Inefficient delivery had the biggest year-on-year increase (5%).

The report recommends emphasising the benefits of Click and Collect as a good opportunity for retailers to encourage shoppers to take advantage of sales day deals, with a focus on ‘budgeting’ and ‘ease of use’. However, data showed that 23% used Click and Collect as an option in 2017 compared to 80% of people who went for home delivery.

Linda-Tait's-Noel-Pop-Up-in-Covent-Garden

GUEST BLOG: The importance of pop-ups to the overall retail experience

Temporary stores are now a permanent fixture in today’s retail landscape. With a growing diversity of brands using the format in different ways, Gareth James, Prosper’s Business Manager, looks at why pop-ups appeal to shoppers and retailers alike…

Pop-up shops may be transitory, but as a format they are here to stay. This agile style of retail is well suited to 21st century shopping and has evolved massively in the last decade, now coming in a wider variety of shapes, sizes, locations and budgets!

A growing variety of uses

The pop-up has long been a stepping stone for small start-ups to test the retail waters with their concept, raise brand awareness and hone the offering. It’s also a natural home for seasonal shopping – exemplified by Noel, a curated festive store that popped up in London’s Covent Garden earlier this month showcasing highly crafted artisan Christmas products.

However, established big brands and retailers are increasingly using them in interesting ways to keep customers engaged. Pop ups can help them launch a new campaign with a bigger bang, reach a new audience and offer limited-edition or customised products.

Whatever the purpose, the great power of a pop-up is how it gives shoppers a good reason to leave the comfort of buying online at home and get excited about retail in real life again.

A focus on experiences

Today’s shoppers – particularly Millennials – value memorable and shareable experiences that can’t be bought online and pop ups are the ultimate vehicle for delivering those.

For starters, that ‘here today, gone tomorrow’ concept creates both novelty and urgency, and ‘fear of missing out’ is a great motivator to attend. The spontaneity of pop-ups can drive impulse purchases, especially for customised and limited edition products, although selling more products in-store isn’t always the immediate goal.

Made to share

Pop ups are rich in social currency and share-ability. People want to say ‘I was there’ and share their experience using social media platforms. If there’s an element of surprise to create a talking point, all the better.

Being such branded space, pop-ups often resemble live mood boards, making them very photogenic and ideal for sharing on Instagram.

You can see this at play with the HermesMatic concept from French fashion house Hermès, which made its UK debut in Manchester last month. Offering professional dry cleaning services and exclusive dip-dye treatments for Hermès signature silk scarves, it gives a new twist to a classic label in a visually impactful way.

A move away from the hard sell

The rise of experience-led retail also reflects how shoppers don’t want to be sold to anymore, but engage with brands on their own terms. Experiences allow brands to connect more deeply and emotively with consumers, to create positive memories that develop a lasting loyalty.

For car brands, pop-ups allow them to reframe their selling proposition away from the hard sell of a forecourt. Volvo recently popped up in Reading’s Oracle mall for an exclusive preview of its new models, as part of a wider Scandinavian experience with an in-store café serving Swedish fika.

Speaking of Sweden, Ikea’s Dining Club is another good example of a great pop-up experience – Ikea kitchens and utensils facilitate the activities yet they stay in the background, as delivering a memorable evening is the primary focus.

A flexible future for retailing?

The upshot of all this pop-up activity is that it’s bringing some hope and new life to the high street. In response to demand, retail centre landlords are offering more short-term leases, to attract new names that refresh their line up.

Larger stores are also subletting areas to compatible brand partners for the same reason. Fashion accessory brand SkinnyDip London is taking advantage of this, appearing as a pop-up in Topshop stores, as well as at intu Watford and Lakeside.

It helps to give shoppers something new to explore and drive footfall. So it’s ironic that some of the online brands that contributed to lowering footfall are also now queuing up as prospective new tenants of physical stores, albeit temporary ones.

They want to connect with customers offline by expressing their brand in a physical space – as seen with Birchbox, the online beauty subscription service that is popping-up on London’s Carnaby Street until January. So there’s still value in ‘bricks and mortar’ stores…

Watch this space

The future for pop-ups? Well they are certainly not going away and new potential will surely come from finding opportunities in more unusual spaces, like when pop-up facilitator Appear Here partnered with Transport for London (TfL) at Old Street Station.

The project reimagined TfL’s approach to retail and also prompted use of forgotten spaces… with one kiosk in an old cleaner’s cupboard! Expect more hidden and unexpected locations to be untapped.

So pop-ups are likely to get more weird and wonderful. But that’s ok… it makes for a great experience!

If you would like to find out how we help retailers create great experiences with Pop-Ups, please get in touch hello@madebyprosper.com or visit http://www.madebyprosper.com/pop-ups

Etailing Summit

Register for the eTailing Summit 2018 today!

The eTailing Summit returns on July 10th 2018 at the Hilton London Canary Wharf, once again providing the leading platform for senior eCommerce professionals to meet with trusted solution providers.

As a VIP delegate, you’ll also be able to learn from the sector’s preeminent thought-leaders in educational seminars and network with peers.

The 2017 instalment of the event was the most successful yet, with attending delegates from the likes of Olivia Burton, Feelunique, Molton Brown, notonthehighstreet.com, Huggle, Kimberly Clark, Thomas Cook, IKEA, Belstaff, Perry Ellis, Antler, River Island, Samsung, Royal Caribbean, Dixons Carphone, Wickes, Hotel Chocolat, Drake’s, Fortnum & Mason, Signature Gifts, Charlotte Tilbury, Skinnydip and many more.

A bespoke itinerary of meetings with solution providers is created for each delegate, based on their selections, so there’s no time wasted. In addition, delegates have access to insightful and inspirational seminars, plus full hospitality is provided throughout the day.

It’s a great opportunity to benchmark and gather information on new services and solutions within eCommerce, all in one place.

Of course, for 2018 the event will remain completely FREE to attend for eCommerce professionals – to register for your VIP delegate place click here, or contact Katie Bullot on 01992 374049 or email k.bullot@forumevents.co.uk.

Alternatively, if you’re an eCommerce solutions provider and would like to showcase your products and services at the eTailing Summit, contact Craig Ross on 01992 666726 or email c.ross@forumevents.co.uk.

Retail Shopfitting & Display Summit

Activate your free ticket to the Retail Shopfitting & Display Summit

The Retail Shopfitting & Display Summit is a highly-focused, two-day event created specifically for senior retail professionals like you.

Taking place on February 5th & 6th 2018 at the Radisson Blu Hotel, London Stansted, it’s a proven format, matching you with solution providers who suit your requirements and projects. No time wasted and no hard sell.

At the same time, you can attend insightful seminars and network with like-minded peers. Plus all hospitality – including lunch and refreshments, overnight accommodation and an invitation to our gala dinner – is complimentary.

We have a limited number of VIP invitations to the event, so please act swiftly to ensure you don’t miss out.

Register here and activate your ticket today.

Or more information, contact Emily Gallagher on 01992 374085 or e.gallagher@forumevents.co.uk.

Alternatively, if you’re a supplier to the retail sector, contact Courtney Saggers on 01992 374088 or c.saggers@forumevents.co.uk to find out about a range of event partner packages.