Fashion is among the heavily discounted areas

Insights

Shoppers taking advantage of bigger pre-Christmas discounts

Consumers are enjoying bigger discounts than they did during the last festive period as they get ready for Christmas, Deloitte reports

Tuesday 09 December 2014

Buoyant UK shoppers are enjoying a fourth successive year of greater pre-Christmas discounts and promotions.

That’s according to new retail analysis from Deloitte during what is the busiest month in the calendar in terms of shopping.

With some key shopping weekends still to come, the forecast is for the velocity of trading to increase even further. But do retailers face the danger of customers becoming too reliant on heavily discounted items?

Black Friday impact

The prevalence of Black Friday weekend - the largest ever witnessed in the UK - is part of the reason for the huge discounts, while unsold winter stock following an unseasonably warm autumn has also contributed.

Household appliances such as televisions were among the most popular items snapped up by bargain hunters as retailers enjoyed their best November sales growth in five years, up 0.9% on 2013.

“At the moment we are seeing marginally deeper pre-Christmas reductions than last year, and the success of Black Friday has demonstrated the UK consumers’ appetite for a bargain,” said Jason Gordon, consumer business partner at Deloitte.

“However, retailers need to be careful not to create a consumer that is only willing to buy heavily discounted items, especially as a lot of the products reduced on Black Friday were ‘bought for sale’.”
Shoppers looking to get their hands on the biggest bargains out there are heading to fashion retailers, who are trying to clear unsold winter stock as they enter the most important trading period of the year.

Bigger discounts still to come

Discounts vary greatly in size across the market at present, ranging from 8% to as much as 78%.

But they are likely to grow in number and size, with discounts of up to 90% expected on the weekends immediately before and after Christmas.

“Christmas falls on a Thursday this year, so retailers could wait until early that week to make their final big pre-Christmas discounts, but we predict they will come before that, on the final weekend,” added Jason Gordon.

“Looking beyond Christmas, at the current sales velocity we will have noticeably deeper discounts from Boxing Day.”

It’s anticipated that retailers will slash prices even further ahead of the much-anticipated January sales, wanting to capitalise on the desire among consumers to grab a bargain as they push the boat out even more.

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Copyright Press Association 2014

“Looking beyond Christmas, at the current sales velocity we will have noticeably deeper discounts from Boxing Day.”

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