A slump in sales for the UK's retail heavyweights

By Jess Shanahan

Unseasonably warm weather dented retailers’ sales in December. Retail sales contracted 0.9% from November. That’s the worst December showing since 2010.

Year-on-year sales – including fuel – are up by 2.6% from 2014 to 2015 but that’s much lower than the 4.4% growth that was expected.

So many factors are being blamed for the slump towards the end of last year. The weather, aggressive online sales, and terrorist attacks in Paris all dampened shoppers’ enthusiasm.

Marks and Spencer was one of the worst hit with its clothing sales dropping by 5.8% - much worse than was evene expected for the company. The food arm, however, did well with an interesting array of food that drew shoppers in. 

Clothing retailer Next is also blaming the warm weather for a drop in sales over the festive period.

Sainsbury’s also posted a 0.4% fall in like-for-like retail sales for the third quarter, slightly ahead of analyst estimates of 0.7%.

Justin Anderson, VP Sales, CRM and HCM at Appirio, has some advice for retailers. He said: “The latest end of year sales figures have proved disappointing for some of the UK’s retail heavyweights as many have seen a decline on year-on-year sales. Reports have pointed to external weather conditions and tragic events throughout November and December as contributing factors. While these are points to remember there is a lot to be said and done internally so that retailers can begin to explain their numbers regardless of these factors. 

“What is really key is understanding customers. Finding out what they want and figuring out how to give them exactly that — whether it’s a product or service — is the holy grail of successful business, and retail is no different. In order to achieve both, they need to be able to anticipate customers’ needs and desires through digital technology like mobile apps, responsive web properties, and customer communities.

“Targeted, personalised marketing is also essential. One of the main issues for a number of retailers is that they often try to reach all potential shoppers, instead of creating unique offerings for their true customers, which makes it extremely difficult for them to consolidate loyalty. To provide a personalised, consistent customer experience that will in turn help establish loyalty, retailers need to fully understand who their customers are — their pain points, their motivations, or what it takes to turn them into repeat customers and then market to them. To make this customer experience as successful as possible, retailers need to create an incredible worker experience. Ensuring employees are happy and can quickly and easily access the information they need will have a positive impact on how they deal with customers.

“Retailers can’t necessarily prevent the external factors impacting on sales figures and nor should they need to. By improving the worker experience and understanding customers, retailers can continue to deliver the best possible service which will in turn be reflected in the numbers.”

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