Data from Visualsoft shows that revenue for retailers increased during the 2023 festive period – with consumers prioritising more orders of smaller value.
Revenue grew 12-13 per cent before Christmas and for December as a whole, with the week before (18th-24th) Christmas seeing a 20 per cent increase YoY. With more couriers offering guaranteed next-day delivery, this increased flexibility meant consumers could purchase those last-minute items. Sixteen different sectors peaked in the first week of December, including electrical goods and home, taking the most revenue on a day between 3rd and 10th December.
Order numbers experienced a more significant increase compared to revenue. The data indicates an average rise of 19 per cent, with a notable surge of 34 per cent during the week before Christmas (18th-24th). This implies a trend towards purchasing more lower-value items over big-value ones. With a cost of living crisis this winter, shoppers may feel the pinch while striving to capture that magical feeling of Christmas with piles of gifts under the tree. This is supported by the fact that Average Order Value dropped by 5 per cent.
Consumers want to look good
The fashion sector witnessed significant growth, accounting for 28 per cent of all revenue – up 39 per cent year-on-year, suggesting that essentials, such as clothing, became gifts in 2023. Additionally, footwear accounted for 10 per cent of revenue, experiencing a 28 per cent rise, showing that consumers desire fashion and clothing at this key time of year. Jewellery revenue constituted 7 per cent of revenue, an increase of 15 per cent compared to the previous Christmas. Interestingly, Boxing Day emerged as the peak trading day for footwear, with many retailers maximising communications around sales.
As well as looking good themselves, consumers prioritised their homes. Furniture, home furnishings and DIY accounted for 16 per cent of sales, although it experienced a 13 per cent YoY decline, whilst more budget-friendly products such as flooring, rugs, and carpets skyrocketed 79 per cent. While this isn’t a sector typically associated with Christmas gifts, it could imply a desire to either gift practical items, or focus more on your own home rather than spending on gifts that may be forgotten about quickly.
Sports, outdoor and recreation sectors also saw a healthy increase of 20 per cent YOY, suggesting that consumers are kick-starting their New Year’s resolutions early.
Traditional sectors waning
Arts and crafts are often associated with custom gifts, decorating, card making and similar at this time of year, however in 2023 retailers saw a drop in revenue by on average 35 per cent. Also surprising was that the babies, kids and toys sectors saw a drop on average of 45 per cent, but the gifts, gadgets and games sector increased by 30 per cent, suggesting that electricals and screens are overtaking traditional toys.
Shifting trends
A quarter (25 per cent) of online visits in December took place in the week before Christmas yet this only translated to 20 per cent of total revenue. People are clearly still browsing online at this point, but due to the close proximity to Christmas, may have headed instore to find an item. This underscores the importance of brick-and-mortar and e-commerce websites being aligned. The other possibility is consumers are looking for the Christmas sales to start, so are returning to sites in the hope of grabbing an early bargain.
The data shows that there was a 37 per cent increase in revenue in the pet sector. More and more of us are choosing to treat our pets as family, and spoiling even the furry ones in our lives.
As predicted by global shopping trend analysis, more and more consumers are opting to shop by mobile. Over half (57 per cent) of revenue was generated via mobile orders, demonstrating how mobile commerce needs to be a key channel for all retailers. This has increased since Black Friday (the percentage of orders via mobile was 54 per cent in this trading period) – a steep rise in a short period of time – suggesting convenience is key at Christmas for consumers and that seamless checkout needs to be a priority.
Ashley Wright, VP of commercial at Visualsoft, commented, “The data suggests that whilst generally, sales were healthy in the run-up to Christmas 2023, we are seeing some changing consumer behaviours, with people prioritising smaller orders placed more frequently, and opting for practical presents. Ease continues to be of importance, and simple payments, mobile eCommerce and stress-free delivery will be key in 2024. Retailers should ensure that those consumers who have purchased frequently over the festive period are nurtured, to ensure ongoing engagement and increased loyalty as we enter the new year.”
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