Christmas 2017 will show record online sales with the Irish consumer now more comfortable than ever shopping in the virtual world, according to a new report from Retail Ireland, published today (5 January.)
The group outlined in it's latest Retail Monitor that 2017 was notable for a rapid increase in online shopping by Irish consumers.
The Ibec group that represents the sector said that the retail sector is currently undergoing one of the biggest structural changes in its history, and that there is a growing disconnect between increasing consumer disposable income and the unspectacular performance of a range of retail categories over the crucial Christmas trading period, is evidence of a dramatic pick up in online retail sales and changed consumer spending patterns.
“We know that the majority of online trade leaves the State on a daily basis, with some putting an estimate of 70% of all digital purchases transacted on websites based outside of Ireland. For some retail categories we have reached a critical point, where failure to act in the short term will lead to closures and the gradual disappearance of certain retail formats from our high street.” Thomas Burke, Retail Ireland director said.
“A clear digital strategy will be crucial in ensuring the future of such businesses who must embrace the challenge at all levels of the organisation.”
Burke also highlighted the role Government will have to play in the required transformation.
“Bricks and mortar retailers continue to carry all the burden of costs associated with retailing in the State. A growing cost base linked to increasing local authority rates, insurance premiums, regulatory red tape and Government mandated wage rates, all give an undue advantage to their competition, most likely based in a warehouse in a city or town in the UK." He said.
“We must ask ourselves, as a country are we happy to lose large swathes of commerce providing rural employment and contributing to their local communities? We must face the challenge head on and seek to level the playing field for our retailers”.
The Retail Ireland Monitor also calls out another key trend in Irish retail over recent years.
The report indicated that sales in December fell by 0.7% when compared to those in November, highlighting the growing importance of promotional events such as Black Friday and Cyber Monday, which are now actively displacing consumer spending from later in the Christmas season.
“The jury remains out on the longer-term impact of promotional events such as Black Friday. Some in the industry suggest they are merely bringing forward purchasing decisions at the expense of profitability due to discounting," he added.
Supermarkets And Convenience Stores
Other key retail trends set out in the Retail Ireland Monitor show that December showed solid growth over 2016 with the multiples collectively holding their own against discounters, but only through very aggressive price discounting, particularly in beverage lines.
Throughout Q4, growth was driven by increasing prices at the pump and sales in coffee and beverages including alcohol. The category achieved record car wash sales in the week prior to Christmas, with sales over double that of the same week in 2016.
© 2018 - Checkout Magazine by Donna Ahern