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(Alliance News) - Retailers in the UK again felt the brunt of consumer uncertainty, with numbers on Monday showing yet another footfall decline in December, despite the pivotal Black Friday promotional spell falling during the period.
In the five weeks from November 24 to December 28, footfall across retail destinations in the UK fell by 2.5% from last year, data from the Springboard Footfall Monitor & Insights showed.
This was despite the Black Friday weekend, when retailers both on the high street and online offer a flurry of promotional discounts, occurring on November 29. The sales follow the US's Thanksgiving Day holiday, which in 2019 came later than normal.
Springboard Marketing & Insights Director Diane Wehrle said: "The 2.5% drop in footfall across UK retail destinations during December was not a surprise as footfall has declined in December in all but one year since 2009. The challenge for destinations and stores was not only that this was the eighth consecutive year that footfall has decreased in this key trading month, but that it was also at the upper end of the scale in terms of the magnitude of decline."
High streets again showed larger scale declines, with footfall falling by 3.5% in December. In shopping centres, footfall was down 2.1% and in retail parks, it fell by 0.5%.
Wehrle said: "Essentially this discounting bonanza pulled Christmas trading forward."
The early Black Friday increased footfall in the first two weeks of December by 0.1%, though in the last two weeks, footfall was down 6.1%, almost three-times as worse than the 2.2% in final fortnight of December 2018.
Wehrle added: "Today's rather circumspect consumer was clearly demonstrating considered restraint towards their lifestyle and spend decisions over the Christmas period. The growing climate change movement and increased consumer concerns around waste and sustainability is likely to have further limited trips to destinations to make non-essential purchases, thereby diluting footfall even further."
In December, supermarket spending edged just 0.2% higher, despite price inflation increasing by 0.6%, Springboard noted. Supermarket sales volumes dropped by 0.7%.
"Other influences that will have driven down footfall in stores and destinations during December include the strong shift in consumer demand towards experience/leisure based trips, away from wholly transaction focussed visits," Wehrle explained.
Data published by Springboard earlier in January showed that between December 26 and January 1, the post-Christmas shopping period, footfall dropped by an average of 4%. This was also blamed on consumers shying away from shopping trips and preferring leisure-based activities.
Last week, several retailers reported Christmas trading numbers, with the likes of John Lewis Partnership and homewares and clothing firm Joules Group PLC reporting sales slumps.
In an interview with Alliance News, Wehrle said: "The John Lewis result was a surprise. When they don't do well, it's always a barometer for the market. Joules, which has been a favourite of the high street, didn't have a good Christmas but they had issues with their supply chain so that may have been specific to them."
Total sales in the seven weeks to January 4 were down 1.8% year-on-year to GBP2.17 billion, John Lewis said. Meanwhile at Joules, an "internally generated stock availability issue" drove "disappointing" sales over the seven weeks to January 5. Total retail sales were down 4.5% year-on-year during the period.
Speaking more generally, Wehrle added: "All the results have been relatively poor."
Still to come in January are updates from online outfits ASOS PLC and boohoo Group PLC. Despite not being directly hurt by falls in footfall, Wehrle explained that the duo could be affected by the same problems which have dogged the high street.
She said: "The issues we're facing in our retailers about spending constraints, lack of consumer confidence and consumers just reigning back generally are going to affect ASOS and boohoo.
"The move towards sustainability and less fast fashion will impact them. It's become more of a cultural norm, we're going to be more conscious about it as a society."
Looking ahead to 2020, Wehrle told Alliance News that there could be no end to the mounting difficulties facing retailers in the UK.
Wehrle explained: "There's going to be contraction. The high street is changing already. Yet again we had a poor Christmas and this will force retailers to look critically at their networks and how they operate their whole proposition."
She also called on the UK government to revamp the current business rates system, levies paid by firms in the UK.
Wehrle said: "The obvious thing is the rates system. Completely overhaul the current system and abandon the current rates system and change that to a new taxation system which levels the playing field between online and stores.
"But of course every store retailer generally has an online proposition so there will be an impact. So while rates in their stores will drop, they will be paying more on their online bit. But that would encourage smaller retailers and independents."
By Eric Cunha; ericcunha@alliancenews.com
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