Who won Christmas 2016?

UK retail sales trends

UK retail sales had a strong performance over the Christmas period. Black Friday, which was launched in the UK in 2014, drove sales growth in November at the fastest annual pace for 14 years. With some of the Christmas spending brought forward to November by Black Friday offers, December started at a slow pace, increasing fears for declining sales especially for high street retailers. However, sales were boosted by a last-minute Christmas rush.

November 2016 Black Friday

Cyber Monday

December 2016 Christmas

Busy Christmas period for retailers, with a peak on Black Friday

£34.2

UK retail sales in November were up 5.9% from the year before. The amount spent in the retail industry

reached £34.2 billion.

£33.5

Sales rose +4.3% in December 2016 on an annual basis.

+5.9% YoY

+4.3% YoY

Source: Office for National Statistics Confidential and copyright of Somo Global Ltd. February 17 2

The festive season in 2016 saw a further decline in High Street sales for the fourth year in a row. This decline was only in part mitigated by a positive final week leading up to Christmas day, with a double digit growth in retail sales. Online continued to grow over the period, with a strong performance in November. This is driven by Black Friday, which has become a massive online event, as many retailers like Amazon, Argos and Shop Direct started their online sales offers up to 10 days before the date.

Sales growth is the tale of two halves

High Street sales fell in December for the fourth year in a row, down -0.1% compared to 2015.

Fewer shoppers visited the High Street during the first three weeks of December , leading to an overall footfall decline of nearly 2%.

However, in the week up to Christmas Day high street sales rose 11.7% compared with the same week in 2015.

-0.1%

-2%

+11.7%

December online sales leading up to Christmas increased by 21.3% on an annual basis. Online sales were 15.1% of all retail spending.

Black Friday boosted online sales in November with 24.9% growth compared with last year. Online sales accounted for 15.8% of all retail spending.

In the six weeks before Christmas, a total of £25bn was spent online.

+21.3%

+24.9%

£25bn

Bricks and Mortar Online

Source: Financial Times, BBC, Office for National Statistics Confidential and copyright of Somo Global Ltd. February 17 3

Black Friday is now the UK’s biggest online shopping day in the festive season, with

online revenue hitting £901 million.

Peak sales has shifted consistently towards

Black Friday, with 28% more online orders placed than during

the Christmas period.

Over 60% of all Christmas online

orders were made on mobile devices, versus only 51% during Black

Friday.

Tablets sales were down -3% in December 2016.

This decline was compensated by

smartphone sales, with a +47% year-on-year

growth.

£901m +28% 60% -3%

Source: Internet Retailing Source: Mobile Marketing Magazine Source: Mobile Marketing Magazine Source: IMRG and Capgemini

Confidential and copyright of Somo Global Ltd. February 17 4

Black Friday wins online, Christmas wins mobile

Singles Day sales – a Black Friday-style sale day across Asia – reached $17.8bn in November 2016.

82% driven from mobile.

Source: Campaign live

Growth by Store Type YoY, Dec 2016

Source: Office for National Statistics

Confidential and copyright of Somo Global Ltd. February 17 6

Grocery recorded highest growth in last 3 years

Clothing was the hardest hit in the High Street

High Street fashion was the hardest hit

+2.0% +3.2% +4.5% +11.9%

+23.0%

-0.1% Food Stores

Fashion Stores

Non Specialized

Stores

Non-food Stores

Other Stores

Online Stores

Bricks and Mortar

Bricks and Mortar trends

Online top performers are leaders in mobile

2016 was Amazon’s most successful holiday shopping season. An estimated 38% market share of US online revenue during the period. Global shipping peak was on Dec. 19.

Shipped more than 1 billion items through Amazon Prime and Fulfillment by Amazon services.

More than 72% of orders came from mobile devices.

38%

1bn

72%

97m

Shop Direct is the second largest online retailer in UK. Very.co.uk grew sales by +19%, while group sales increased +9% YoY.

In 2016 Shop Direct reached 97 million site visits with over 400,000 new customers, up 16% YoY.

68% of Shop Direct’s online sales are completed via mobile devices.

+19%

68%

Source: Business Insider Source: Shop Direct

Brands who mastered omnichannel and mobile won Christmas 2016.

Did your business make the most of Christmas 2016?

If you need help making the most of festive season, you can contact us at: marketing@somoglobal.com