“In October (see: The Prospects for Christmas 2019) we predicted growth, in the non-seasonally adjusted figures, of 3.5% to 4%, with our expectation being that it would be towards the upper end of those numbers. So growth of 3.4% shows demand was a little weaker than expected, and the results we have seen from the retailers so far indicate it was a tough period for many in the sector not helped by the lead up to Christmas Day itself being shrouded by uncertainty and a general election. Indeed data from our upcoming Christmas Gift Buying – UK, February 2020 shows that over a third (36%) of Christmas shoppers said the general election and Brexit overshadowed Christmas in 2019.

This year’s data includes the Black Friday weekend, and its effects are clear, online saw its strongest (+11.6%) growth since August and accounted for a record 21.3% of sales, whilst electricals (+22.5%) was the standout performer year-on-year. However stripping out Black Friday and it is clear trading was tough. Value growth was low in the grocery sector (1.9%) which we were expecting given the investment into price and the consumer desire for value, but this did not drive greater volumes, with growth of just 0.6% indicating lower prices did not drive quantity. Trading in non-foods was even tougher with growth of just 0.7%, including Black Friday, with a particularly notable 4.7% decline in clothing indicating that the proximity of Black Friday to Christmas simply served to allow shoppers to complete Christmas purchasing at cut price – leaving little for December itself.

We will piece together our more thorough thoughts on Christmas in the upcoming report but this data, combined with the BRC’s, and the reported retailers figures indicates that Christmas 2019 was at best a mixed bag for the retail sector. The underlying demand was there, if reluctant and value conscious, but the proximity of Black Friday served to only ensure more of this demand was served on promotion leaving little chance for retailers to capitalise on full-price trade in December itself. The clear winners were the value players (Aldi, Lidl, Primark), those at the extreme premium end (Fortnum and Mason), and those with online prowess. Indeed Amazon doesn’t report Christmas figures but the desire for value and convenience, coupled by the particularly disruptive Black Friday, the event it worked so hard to install in the UK calendar, will likely have served to make it a very good Christmas indeed for the retailer.”