Xmas spending shift was behind Black Friday boom
Despite the biggest shopping day on record, consumer spending over the wider Christmas shopping period grew by 4.1 per cent – in line with the previous month – according to figures from Barclaycard.
They came after a warning earlier this week by John Lewis’ managing director Andy Street that retailers should reconsider heavy discounting on Black Friday.
Street said the US-inspired retail phenomenon was “more challenging profitability-wise”. “We’ve got to ask if it’s right to concentrate trade so much in that one period,” he said.
The Barclaycard figures showed that Black Friday spend shot up 18 per cent year-on-year as value-seeking shoppers concentrated more of their expenditure than ever before on shopping early to take advantage of the discounting frenzy. Adding in 6 per cent growth for Cyber Monday, the four-day weekend posted the strongest spend growth of the year, at 10.7 per cent.
The credit card firm said Black Friday and Cyber Monday also gained the first and second spot respectively for the top online spending days in all of 2014. The rise of Black Friday – more traditionally associated with Thanksgiving in the US – is relatively recent, the day having only been tenth in spending volumes in 2012.
But the two days had a knock-on effect on periods traditionally known for high spend during the festive period.
Spend in the first half of December grew just 2.3 per cent and the week before Christmas was up by 3.8 per cent. As demonstrated in many of the sales figures posted by major high street retailers over the last week, the large price cuts seem to have taken a toll on retailer profitability, while not necessarily increasing sales substantially.
Boxing Day was another heavy discounting day that displayed a strong performance, with spend up 9 per cent year-on-year. More people chose to shop from the sofa as online spend grew 16 per cent for the day, while in-store spend was up 6 per cent.
Petrol saw the biggest drop in spend during the holiday season as prices came down, falling 8.2 per cent. With some extra money in their pockets, and greater financial confidence stemming from an improving economic backdrop, continued falls in unemployment and lower inflation, consumers spent more on going out, gifts and treats.
Restaurant growth shot up 16 per cent, while jewellery jumped 6.9 per cent and clothing 4.3 per cent. Travel also performed well, with airlines seeing a 6.9 per cent rise in spend.
The household sector saw a 4 per cent rise, though fortunes were mixed for retailers – DIY stores posted a 6.9 per cent increase on 2013 whilst electronics grew moderately at 2 per cent and furniture growth was flat.
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