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We kicked off our retail shakedown with a dive into the trends and insights from across Q4 in 2019. Finance Director Sally Laycock was joined by HSBC’s David Maddison for an in-depth fireside chat.
Unsurprisingly, some of the biggest winners from Q4 were online retailers; but more interesting was the popularity of stores like B&M and Aldi. The UK population are no longer ashamed by shopping at value stores, and that’s been reflected in their late-year sales. Another area on the up-and-up were sustainable gifting options; brands such as Hobbycraft and Lush were doing very well over this period.
When it comes to the high street, results were exceptionally polarised. On one side, you had brands like Hotel Chocolat and WH Smith doing really well, but on the flip side you had other brands like Superdry, Moss Bros and Quiz Clothing all down on the previous year. However, this decrease was deliberate, with efforts being placed on moving towards more profitable channels – so while sales were down, their gross profit was actually up. With this in mind, 2020 will be all about reorganising the cost-base to increase your gross margin and remain a sustainable business.
Just looking at Black Friday, this was the first year where it overshadowed Christmas sales in terms of sales going through the tills. In part, this was due to the lateness of Black Friday, as more women in particular were doing proactive spending in time for the gift giving season. On top of this, it wasn’t just Black Friday weekend or even week; most brands had some kind of discount on throughout the entire month. As such, it’s likely that the success of Black Friday was an anomaly, and not something to expect in future years.
Turning our attention to the year to come, 2020 will likely see stabilisation and a fair bit of growth compared to the past 2 years. As you look to make the most of this opportunity, there are a few key trends to keep in mind:
- Exclusivity of product is often a key driver for sales. Only selling your product in your store will help avoid the race to the bottom and create demand.
- Stating your brand and product purpose is a hugely valuable marketing tool.
- As much as it is a buzzword, experience is a huge driver for consumers; just think Harrods and Fortnum and Mason.
- Convenience will always be a driver – it’s why so many users shop online.
- Ensure the products offer value for money.