Online sales provide relief for UK retail sector

Andy jalil – – While the high street stores have for some time suffered from a drop in footfall, online sales have continued to forge ahead. Cyber shopping delivered a much-needed sales boost for retailers in Britain. Shoppers have been preparing for the festive season and snapping up Christmas gifts on their mobile phones instead of heading to the shops.
While analysts warn of excessive discounting, ‘Black Friday’ and ‘Cyber Monday’, ideas of retail discount days imported from the United States, have become a key focus for the sector ahead of the busy Christmas shopping period.
Online sales in Britain grew by three per cent last week compared to the corresponding week’s last year, according to analysis by PCA Predict.
Furthermore, the Internet was a revenue-raiser for retailers during the last weekend of November (figures released this week) with online sales rising by 24 per cent over the two days.
Online sales were up nearly six per cent on Black Friday despite a drop on the high street.
In the United States where Cyber Monday generates massive sales, it is estimated, according to Adobe Analytics, that the figure at $6.6 billion was up by $1 billion from a year ago.
In the UK, London saw the biggest sales uplift compared to an average Monday, with sales soaring 199 per cent, according to data from Ve Global.
Shoppers in south east London were the most active in the UK, with consumers in east of the capital and the north ranking fourth and fifth respectively.
The cyber boom comes after footfall slumped by 3.6 per cent across the UK retail destinations on Black Friday, according to analysis by Springboard.
The fall in shoppers exceeded the forecast 0.6 per cent decline.
However, retailers must contend with more than just a switch to online shopping. Shoppers are increasingly buying their goods on mobile sites, which present a new challenge for website developers.
Black Friday has become an extended period of discounting, which analysts have warned will be detrimental to margins at a time when costs pressures are also rising.
According to retail analyst Richard Hyman, 84 per cent of non-food retailers were on sale last week.
The discount season has become a “drug” for retailers who are unsure of how to attract shoppers, he said.“As what used to be the golden quarter unfolds, retail distress is unfolding still faster.
Discounts, job losses, the appointment of advisers to ‘review strategic options’ are all symptoms of an industry unsure of where its revenue line is headed.”
The Internet has changed the way people shop but in the UK the appetite for shopping is as voracious as ever.
The web has disrupted retail as much as any sector: it accounts for about 14 per cent of retail spending in Britain, and it is growing fast.
In the UK, people spend more per capita online than any other country in the world, and over a billion parcels are sent every year. For many years, the prevailing view has been that the rise of online retail will result in the death of the traditional high street shops.
There are an estimated 1,500 high streets in the UK and many feared that the ever-increasing online shopping would render them redundant.
While some high streets have been adversely affected by the rise of online shopping, we are seeing a greater collaboration between online and physical retail.
There was a considerable rise in sales in the retail sector as a whole in November, the Confederation of British Industry (CBI) found 40 per cent of retailers reported a higher sales volume year-on-year last month: 13 per cent said volumes had fallen.
The data comes from a difficult October, when sales fell for the first time since 2013, according to data from the Office for National Statistics.
Chief UK economist at Pantheon Macroeconomics, Samuel Tombs, said the figures were a “solid start”. However, he said it was to early to tell what would happen over the key festive season shopping period.
CBI chief economist, Rain Newton-Smith, said: “It’s great to see retail sales rebound after a big dip, but let’s be clear: our high streets are not out of the woods. Ahead of the crucial run up to Christmas, the weaker pound pushed up prices and retailers are nervous about business conditions and are trimming their workforces.” (The author is our foreign correspondent based in the UK. He can be reached at