Retailers face ‘nerve-wracking run-up to Christmas amid weak consumer demand’

A record £1 in every £3 of non-food purchases were made online in November, a report has found.

But aggressive promotional activity by retailers ahead of Black Friday failed to lure shoppers, with like-for-like sales in November decreasing by 0.5% on last year, the British Retail Consortium (BRC)-KPMG retail sales monitor found.

Those behind the report said retailers now face a “nerve-wracking” run-up to Christmas.

The report said the proportion of non-food purchases taking place online increased to 33.8% in November – an all-time high.

BRC chief executive Helen Dickinson said: “This month cemented Black Friday as an increasingly digital event, with a record £1 in every £3 of non-food purchases made online during the month.”

She continued: “Weak consumer demand and falling confidence mean that retailers are in for a nerve-wracking run-up to Christmas.”

Sue Richardson, retail director at KPMG, said: “Aggressive promotional activity around Black Friday failed to lure shoppers, with like-for-like sales in November actually down 0.5% on last year.

“The benefit of the full weekend, including Cyber Monday, won’t be realised until next month, but it’s clear that growth remains elusive for many retailers.”

Meanwhile, a separate report from Barclaycard found just 52% of people across the UK say they have confidence in their household finances – the lowest level recorded since Barclaycard started tracking this data in 2015.

Just four in 10 (40%) people feel confident in their ability to spend on non-essential items. and nearly two-thirds (64%) say they are being careful to seek out value for money in the purchases they make.

Barclaycard said the retail sector continued to face challenges, with department store and clothing spending shrinking by 7.1% and 2.9% respectively year on year.

Bucking the trend, the entertainment sector put in a relatively strong performance, with ticket sales soaring by 30.5% year on year – the highest increase since November 2014 – as the Spice Girls reunion tour and Fantastic Beasts: The Crimes Of Grindelwald helped to boost sales.

Esme Harwood, director at Barclaycard, said: “November was a mixed month, with department store and clothing spending contracting but entertainment remaining strong.

“It seems shoppers are yet to make their main Christmas purchases for friends, family and loved ones – despite many retailers offering Black Friday discounts to try and boost sales.

“This may be unsurprising, given we’ve seen consumer confidence in household finances fall to a record low, likely influenced by ongoing political and economic uncertainty.

“As the final countdown to Christmas begins, it will be interesting to see whether shoppers will be enticed back to the high street over the next few weeks.”