ONS retail figures reveal slowing growth amid increasing prices

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The Office for National Statistics (ONS) has released its retail figures for December 2017.

In the latest three months, the quantity bought in retail sales increased by 0.4% compared with the previous three months; while the underlying pattern remains one of growth, this is the weakest quarterly growth since the decline of 1.2% in Quarter 1 (Jan to Mar) 2017.

On the month, the quantity bought decreased by 1.5% when compared with strong sales in November 2017.

For the whole of 2017, the quantity bought in retail sales increased by 1.9%; the lowest annual growth since 2013.

In non-seasonally adjusted terms, shopping for Christmas has shifted in recent years from being mainly in December to more in November as consumers seem to be starting their purchasing earlier in line with Black Friday promotions.

ONS senior statistician Rhian Murphy commented: “Retail sales continued to grow in the last three months of the year partly due to Black Friday deals boosting spending.

“Consumers continue to move Christmas purchases earlier, with higher spending in November and lower spending in December than seen in previous years. However, the longer-term picture is one of slowing growth, with increased prices squeezing people’s spending.

“Over the year the proportion of internet spending is continuing to rise, with almost one in every five pounds spent online by the end of 2017.”

Amplience VP of customer success Craig Smith believes the figures should encourage retailers to examine their digital offering and adapt to consumer demands.

He said: “After an already challenging year, many retailers must feel like they’ve woken up to a belated lump of coal in their Christmas stocking. Disappointing December trading figures only compound the reality that retailers aren’t doing enough to engage customers. In this uncertain economic and political climate, deep discounts and speedy deliveries may no longer be enough for retailers to survive.

“The retail engagement challenge will only increase throughout 2018. After a disappointing Christmas often comes a slew of New Year profit warnings. Increasingly, the sector is becoming a two-speed affair. It is now split between retailers unable to keep up with their customer’s demands and those able to adapt and capitalise quickly on the latest trends.

“The customer experience has changed beyond all recognition, becoming more mobile-centric and social-media focused than ever before. In order to succeed in today’s world, retailers must deliver targeted, enticing content that is optimised for mobile. Retailers who have failed to realise this don’t have much time left!”

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