UK's Christmas e-spending surge to boost multichannel stores - study
Consumer spending surveys come thick and fast in the weeks leading up to Black Friday and Christmas. And while some have shown a significant number of consumers planning to cut their spend, the latest study also shows a bigger percentage will maintain or increase their Christmas outlay.
Consumer and location intelligence specialist CACI spoke to 2,000 UK shoppers earlier this month and said that 62% of them planned to spend either the same or more this Christmas. And 40% will wait until the shops reopen next month to do their Christmas shopping, suggesting that the early Christmas shopping trend this year won't lead to a tail-off in spending during December.
The data showed “retailers can look forward to £3 billion of spend staying in shoppers’ pockets until stores reopen in December”. In fact, half of these consumers have intentionally delayed their shopping from November to December to spend in-store, rather than online.
For those consumers planning to spend more, the average increase is likely to be £390. While the 38% of customers looking to spend less will only cut their spend on average by £183. That means an overall healthy increase in total spend.
Another interesting point is about the so-called online halo effect. During the current English lockdown, CACI’s research shows there will be a significant uplift in this effect, as multichannel retailers will still benefit from £1.6 billion of spend, but will receive it via their online channels. Generally this figure is around 53%, but during November CACI highlights it will increase to 62%.
This follows reports that have come out throughout this year showing that retailers with physical shops have benefited from bigger uplifts in their online sales than pureplay e-tailers have as consumers sought to patronise their favourite stores even though physical shops were shut.
CACI said that of those deciding to switch from physical stores to online, 46% are going to purchase from the website of the specific brand that they can no longer visit in person, further highlighting the role of stores in shaping consumer behaviour.
Only this week, in an interview the boss of Pandora also highlighted this effect and said that when the company has closed physical shops for good, online sales in that area also go down.
Alex McCulloch, Director of CACI, said: “Christmas is going to be an even more crucial period this year, as retailers will be looking to make up significant consumer spend they have lost throughout the pandemic. Our latest consumer survey is evidence there is still hope of a solid spending period for Christmas shopping, but it is key [that] bricks and mortar retail can reopen at the beginning of December.
“That said, it also highlights just how quickly consumers are changing their habits. Back in March, CACI found consumer trends moved forward five years in the space of two weeks, and this survey highlights the implications of such huge shifts in behaviour. Those retailers able to be flexible and adapt will benefit, leaving those that cannot, or will not, change behind.”
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