UK retailers predicted to enjoy bumper Christmas sales

By

Barbara Santamaria

Published
Oct 19, 2016

UK-based retailers are gearing up for a bright Christmas period as retail sales are forecasted to grow an estimated 2.5% in December 2016, reaching £42.2 billion.

According to new research from Mintel, 20% of Brits will be shopping most or part of their Christmas gifts online, with the number rising to 24% when it comes to men and 28% to 16-24 year olds.

The top three reasons why Brits shopped online for gifts last year were to get cheaper prices (55%), to avoid the crowds (49%) and to shop when it suited them (49%).

Richard Perks, Director of Retail Research at Mintel, said: "The economic background for consumers continues to be favourable. Real incomes are rising and unemployment is falling. There are some worrying signs though. Consumer credit has risen back to record levels and the housing market has weakened a little but overall, the prospects for Christmas remain good."

Perks added that a high number of high street retailers are fighting back against consumers’ belief that it is cheaper to buy online by offering price match policies against online retailers.

Last year 86% of consumers bought their gifts in-store, versus a 76% of consumers who purchased online.

The Christmas shopping season is kicked off by Black Friday and Cyber Monday. Mintel estimates that in 2015, the discounting days boosted November retail sales by 1.5% to reach £440 million. Indeed, heavy discounts and promotions during these days are a big draw for shoppers with 23% of them planning to put off making big purchases until they have seen this year’s Black Friday and Cyber Monday promotions.

"December 2016's results will very much depend on what retailers do about Black Friday, but if they cut back on such promotions then there will be a knock on benefit to December, as sales roll over into this month,” continued Perks.