The National Backdrop
With a backdrop of tough economic conditions, it was widely acknowledged that the Christmas 2023 trading period would be challenging, however, there were mixed messages as to how it panned out.
Recent trading announcements from key multiple retailers such as M&S and Next revealed strong performance over the golden quarter of October to December and consumer confidence as measured by GFK has shown continuous improvement from October 2023.
At the same time, however, the retail sales results for December published by the ONS show a very different story, with the largest monthly fall in retail sales since January 2021 of -3.2%.
Alongside this, the latest news from John Lewis of a possible loss of 11,000 from its staff and profit warnings from several other retailers, demonstrate tough trading conditions.
So how did UK high streets perform over the key Christmas trading period?
We can evaluate high street performance using two important measures: footfall and sales. Footfall is the most generally recognised metric, and footfall on UK high streets in December 2023 was +3.3% higher than in November and +2.1% higher than in December 2022.
They’re modest uplifts, although this is to be expected given the current economic situation and the fact they came on the back of the pandemic recovery in December 2022, when footfall increased sharply (by +12.9%) as shoppers continued to gravitate back to high streets.
Despite the growth in high street footfall over the past two years, Greater London footfall in December 2023 was -7.2% lower than the 2019 pre-pandemic level, down by roughly a third from -11.1% in December 2022. This is an important milestone in the pandemic recovery, and it should not be underestimated, as much of the difference can now be traced to a natural structural shift in consumer behaviour.
Many consumers now seamlessly integrate online browsing and purchasing with in-store shopping; while only about 26% of real spending occurs online, many shoppers utilise the internet to browse before visiting locations and stores.
Indeed, high street footfall trends over the last 15 years show that even in the absence of the pandemic, this combination of online and in-store shopping would have resulted in a drop in high-street footfall of around -6% over the four years beginning in 2019, leaving only about -1.5% as the “pandemic factor” in Greater London.
Performance of UK high streets during the Christmas 2023 trading period
So, what does the December 2023 footfall result signify for high street sales across the UK? Did physical stores capture the money spent by customers who visited towns and cities?
Beauclair’s data on high street store sales in December 2023 mirrored the ONS sales findings, indicating that shoppers were significantly reducing their spending, with annual declines in both store customers and store sales of -2.6% and -2.8%, respectively.
In fact, the need to reduce spending could have been a positive driver for the +2.1% growth in footfall in high streets in December. Many customers are likely to be pickier as a result of having to work with a limited budget, preferring to touch and feel things before making a purchase rather than taking a chance and relying on photos on a website to buy online.
It wasn’t all bad news for high streets, as the reduction in spending wasn’t universal across all retail categories. While high-street fashion expenditure was particularly heavily hit in December (-8% from 2022), sales in General Retail (-1.1%) and Health and Beauty (-0.7%) fell just little.
Alongside this, sales in food and drink (which includes hospitality) increased by +5.9%, while grocery sales increased by +3.3% from 2022, illustrating consumers’ rising preference for socialising and the continued importance of Christmas lunch and dining at home during the festive season.
How Croydon fared over the 2023 Christmas trading period
In December 2023, footfall in Croydon town centre was marginally lower than in November (-0.8%), but with a rise in footfall of +5.4% outside M&S (North End) and +3.3% outside Barclays (North End), it was evident that the town was attracting Christmas shopping visits.
At the same time, Croydon’s yearly footfall growth in December was modest (+0.2%), and lower than in both Greater London high streets (+5.6%) and in UK high streets (+2.1%). While Croydon did not see as much of an annual increase as Greater London as a whole, the fact that London saw a +5.6% increase is encouraging for Croydon, indicating that growth is taking place in the region and, as a result, that opportunities for Croydon to capture additional spending exist.
In addition to a more modest annual growth in footfall in Croydon from December 2022 than in Greater London, the gap from the pre-pandemic footfall level in December 2019 was also much larger in Croydon (-23.7% versus -7.2% in London).
Footfall Pattern in Croydon over Christmas 2023 trading period
The week of Black Friday (wb 20th November) kicked off the Christmas trading period in Croydon with footfall up +4.8% from the previous week, and up +6.1% in North End compared to week on week declines in the previous week.
The increase in shopper numbers in Croydon over Black Friday week was not as significant as the national picture (+8.5%), but it reflected the national trend, and the bigger increase in footfall in North End suggests that shopping was a key driver for trips into the town centre that week.
However, the widely acknowledged “dumb bell” effect of Black Friday, in which footfall is reduced in subsequent weeks, had an influence on Croydon, but only in the week following Black Friday, when footfall in North End was -3% lower than the previous week.
The good news was that in the following week, the first week of December, footfall increased by +2.5% in North End, matching the rise across Greater London. And then, in the final two weeks of trading, the week-on-week uplifts above the Greater London average: +5.7% in North End on Wednesday, December 11th (+3.5% in Greater London), and an astounding +23.2% rise in North End on Wednesday, December 18th (only +1.7% across Greater London).
Post Christmas Week in Croydon
Footfall in Croydon dropped in the week immediately following Christmas Day, but was higher than in the same week in 2022. On Boxing Day, footfall in the town centre was +15.3% higher than on Boxing Day in 2022 – a really strong result compared with an increase across UK high streets of +8.8% and +10.6% in Central London, and it continued to rise over the next three days, peaking on Friday, December 29th.
So what might this suggest for the performance of Croydon over 2024 and the opportunities for growth?
Croydon’s footfall figures for the Christmas 2023 trading period indicate that it is not yet generating the same level of annual growth as Greater London and UK high streets. On a positive note, shoppers did flock to Croydon to shop during the Christmas 2023 trading period, resulting in significant week-on-week increases in shopper activity throughout the month of December.
Furthermore, the fact that footfall in Greater London increased annually over Christmas suggests that the region is economically resilient, pointing to opportunities for Croydon to capitalise on disposable income within its catchment.
This suggests that Croydon has everything to play for in the coming year; there is a clear loyalty to the town among its existing customer base; however, the challenge for 2024 is to increase this in terms of shopper numbers, frequency of visits, and amount spent when they visit.
About Diane Wehrle SFIPM
Diane Wehrle is the Founder and CEO of Rendle Intelligence and Insights. Diane was previously a co-founder and Marketing and Insights Director of Springboard, which was acquired by MRI Software in October 2022. At Rendle, Diane specialises in turning data into relevant and actionable insights that demonstrate and drive retail business and location performance.
Diane has 36 years’ experience in retail and is regarded as one of the leading experts on retail and retail destinations, with an unparalleled knowledge and expertise in understanding current and emerging retail issues and consumer trends. Diane is a regular commentator on the performance of retail for national broadcast and print media, appearing regularly on BBC, ITV, Sky News, CNBC and Bloomberg and her opinion is frequently quoted in the UK’s national and regional press.
Diane holds an MSc in Property Investment and is a Senior Fellow of the Institute of Place Management, one of only 35 Senior Fellows worldwide. Diane has also been named as one of the world’s 100 top retail influencers by Rethink Retail for the past four years.