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January 6, 2014 12:00 am
Online shopping reached a new record for British retailers this Christmas, leading to a divergence in fortunes between those high street stores with strong web offerings and those still grappling with how to sell online.
Richard Hyman, the independent retail consultant, estimated that online purchases accounted for almost 20 per cent of total retail sales over Christmas, compared with about 15 per cent at Christmas 2012, based on official figures. For non-food, online retail accounted for nearly a third of sales over Christmas, he estimated.
“It was a record Christmas for online, there is no doubt about that,” he said. “Click and collect made it a much bigger Christmas than it has ever been before . . . It allowed consumers to shop right up to the wire.”
Christine Cross, the independent retail adviser, estimated that click and collect now accounted for about 30 per cent of all online retail orders.
Neil Saunders, managing director of Conlumino, the retail research group, said: “Click and collect has been a real boon to online.”
But as well as click and collect, Ms Cross said online purchasing was driven by discounts appearing on the web before they were made available in stores, more Britons shopping on mobile phones and tablets and more confidence that purchases would be delivered in time for Christmas.
“People trusted [online] this year. They knew it would get there. In previous years, it has always been a bit of a wing and a prayer,” she said.
Online is set to be a deciding factor in retailers’ fortunes over the Christmas period. Next, which has a strong online business, had a stellar Christmas, while Marks and Spencer, which is still building its online presence, is expected to have had a disappointing one.
Mid-market retailers are also doing more of their business online, demonstrating that purchasing is no longer the preserve of giants such as Amazon.
Mid-market retailers’ online sales rose 31.1 per cent in December, year on year, according to BDO, the professional services firm. In the week before Christmas, online sales rose 56 per cent.
In contrast, heavy discounting on the high street hit mid-market fashion retailers that suffered a poor Christmas. Underlying fashion sales among about 85 mid-tier retailers with 10,000 stores tracked by BDO fell 4.6 per cent year on year in December.
However, Jigsaw, the privately owned fashion chain, reported a strong Christmas, driven by record womenswear sales. Its sales from stores open at least a year rose 17 per cent in the five weeks to December 28, while online sales rose 39 per cent.
Peter Ruis, the former John Lewis director who became chief executive of Jigsaw last year, said the performance was helped by not going on sale before Christmas, and introducing click and collect in the autumn, with enhanced delivery options in the final few weeks before Christmas.
This week will see some of Britain’s biggest retailers report on their Christmas and new year trade.
M&S is thought to have had a challenging Christmas, after discounting its general merchandise, including clothing, heavily. Analysts who made their forecasts later in December are pencilling in flat underlying sales of clothing and homewares to a decline of 1.5 per cent in the third quarter. Previously, many analysts had expected M&S to report its first increase in like-for-like clothing sales for more than two years.
Tesco is also expected to report a fall of about 2 per cent in UK like-for-like sales, while sales growth has slowed at J Sainsbury, putting at risk the supermarket’s habit of reporting positive like-for-like sales growth.
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