Low footfall in the weeks leading up to Christmas is linked to the anticipation of pre-Christmas bargains, figures released today suggest.
The Retail Traffic Index (RTI) figures from Ipsos Retail Performance revealed that footfall in London and the South East has been down 7.1 per cent year-on-year in December so far.
These figures show that despite the £1.75 billion surge in Christmas spending reported last weekend, London and the South East are failing to perform as well as they did last year.
Surges in the number of Christmas shoppers have been slower than expected, but it is hoped that footfall will improve in the coming week as it is the last week before Christmas.
If people need presents ahead of Christmas Day, the window for buying on line is rapidly closing, suggesting that this weekend will see a rush of last minute shoppers.
President of Ipsos Retail Performance, Peter Luff, said: “Whether or not shoppers will continue to be out in force in the final weekend before Christmas in this region – or indeed any other region of the UK – remains to be seen.
“It’s an interesting scenario and somewhat of a standoff between shoppers and retailers.
“It could be that consumers are simply holding out for even greater discounts and bargains, or they may be holding onto their money with a view to spending immediately after Christmas or in the New Year.”
This news comes as Amazon has announced that its festive sale will begin at 9am on Christmas Day, rather than on Boxing Day.
It is by no means the only retailer to do this, and a survey by the UK Gift Card and Voucher Association revealed that five million people are expected to shop online on Christmas Day, both to redeem gift cards which they have been given and to buy last minute gifts for others.
John Lewis plans to launch its Christmas sale even earlier, starting the online sale at 5pm on December 24th and some retailers will begin discounting products before this.
Commenting on the early discounting trend, Tristan Rogers, CEO of ConcretePlatform.com, said: “The issue, of course, is that when the retailer commits to the price slash, they will be losing margin on product, so the gamble is that they make up for margin erosion in quantity and churn, therefore clearing the floors for new product.
“The first mover gets the advantage, as they hopefully benefit from the pent up demand for a good discount.
“However, bolt early, and the pent up demand is not quite there and you end up discounting for no big turnover advantage.
“The UK retail sector is so poor at the moment that retailers are looking at these rallies as a means of defibrillating the moribund market into life.
“The more reliant they are on the one market, the more stunts like this they need to pull.
“It’s a downward spiral, and not a great start for 2013 for the struggling UK market.”