2023
9
UK Retail Trends – Summer 2023
2023-06-24T04:05:22+01:00
OX1158661
2195
164383
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Report
en_GB
"The first four months of 2023 have told much the same story as 2022, that being significant volume decline and pressure on retailers and consumers alike. Fashion and beauty are…

UK Retail Trends – Summer 2023

£ 2,195 (Excl.Tax)

Report Summary

“The first four months of 2023 have told much the same story as 2022, that being significant volume decline and pressure on retailers and consumers alike. Fashion and beauty are currently the bright spots, and the successes in these areas show that there is still opportunity for low-ticket mood boosters to draw demand from shoppers. The second half should see inflation ease further, and this will ease some pressure on retailers. For those who are bold, cut prices early and communicate this clearly there will be building opportunity to encourage demand, or claim back shoppers which may have elected to trade down as a precautionary measure.”

– Nick Carroll, Category Director – Retail Insights

Key issues covered in the report:

  • Market environment, consumer sentiment and the impact of the cost of living crisis
  • Analysis of UK Retail Sales Performance – Quarter 2 2023
  • Changes in Grocery and Non-food shopping behaviour
  • Retail Launch Activity and Innovation – Quarter 2 2023
  • Special Focus – Customer loyalty in retailing

Table of Contents

  1. Key Findings

      • Market environment and retail sales
        • Food and drink prices keep the pressure on as headline inflation eases
          • Figure 1: Inflation, overall index (CPI) and core categories, 2022-23
        • Consumer’s confidence remains low
          • Figure 2: Household financial wellbeing index, 2016-23
          • Figure 3: Future financial confidence index, 2016-23
        • Value growth, volume decline trend maintains into Q1
          • Figure 4: All retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, 2022-23
        • Rebalancing in the online channel continues
          • Figure 5: All online sales, value non-seasonally adjusted, year-on-year performance, 2021-23
        • Grocery sector enters a second year on consistent volume decline
          • Figure 6: All grocery retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, 2022-23
        • Fashion demand continues its good run
          • Figure 7: Mintel Fashion Tracker: personal fashion purchases in the past three months, 2018-23
        • Health and beauty sees consistent volume growth so far in 2023
          • Figure 8: BPC Tracker: shopping behaviour, 2023
        • Key launches and innovations
          • Sainsbury’s launches Nectar Prices
            • Asda launches autonomous deliveries in London
              • Figure 9: Asda and Wayve autonomous delivery trial, 2023
            • Sainsbury’s launches Nectar Prices
              • eBay launches Better Than New Homewares Hub
                • Zalando set to launch virtual assistant tool powered by ChatGPT
                  • Figure 10: Zalando ChatGPT powered fashion assistant, 2023
              • Market Environment and Consumer Sentiment

                • Food and drink prices keep the pressure on as headline inflation eases
                    • Figure 11: Inflation, overall index (CPI) and core categories, 2022-23
                  • Wage growth stalling, maintaining real income decline
                      • Figure 12: Real wages growth: Wages growth vs inflation, 2016-23
                    • Consumer’s confidence remains low
                        • Figure 13: Household financial wellbeing index, 2016-23
                        • Figure 14: Future financial confidence index, 2016-23
                    • UK Retail Sales

                      • Value growth, volume decline trend maintains into Q1
                        • Figure 15: All retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, 2022-23
                      • Deep volume decline across the spectrum but store-based still outperforming
                        • Figure 16: All retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, by core category, 2022-23
                    • The Interplay Between Online and Stores

                      • Rebalancing in the online channel continues
                        • Figure 17: All online sales, value non-seasonally adjusted, year-on-year performance, 2021-23
                        • Figure 18: Total online sales as a percentage of total retail sales (ex. fuel), 2021-23
                      • Better performance from non-store sees the sector recover ground
                        • Figure 19: Share of online sales, by type of retail operation, 2019-2023
                      • …with stores reclaiming a majority of non-food sales
                        • Figure 20: Estimated share of total non-food sales, store versus online and other non-store, 2021-23
                    • Grocery Shopping Behaviour

                      • Grocery sector enters a second year of consistent volume decline
                        • Figure 21: All grocery retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, 2022-23
                      • Frequency of shop ticks back-up as consumer movement picks up
                        • Figure 22: Household Grocery shopping habits, 2018-2023
                      • Discounters gain as cost of living crisis bites
                        • Figure 23: Format where the most is spent, 2019-23
                      • Key financial updates from food and drink retailers in Q1
                        • Tesco reports a fall in profits
                          • Co-op reports small uptick in sales despite the current economic environment
                            • Sainsbury’s reports a fall in profit
                              • Asda reports falling profits amidst the current economic climate
                                • Morrisons opens its 500th convenience store
                                  • 11% of Deliveroo’s full year revenue was accounted for by on-demand groceries
                                    • Ocado reports revenue increase of 3.4% while basket sizes fall
                                    • Non-food Shopping Behaviour

                                      • Volume decline continues in non-foods, but store-based retailers continue to benefit from stronger footfall
                                        • Figure 24: All non-food store-based retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, 2022-23
                                      • Fashion demand continues its good run
                                        • Figure 25: All store-based fashion retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, 2022-23
                                        • Figure 26: Mintel Fashion Tracker: personal fashion purchases in the past three months, 2018-23
                                      • Home retail hit by brought forward demand and big-ticket caution
                                        • Figure 27: All store-based household goods retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, 2022-23
                                      • Health and beauty: consistent volume growth so far in 2023
                                        • Figure 28: All store-based health and beauty retail sales (excluding fuel), non-seasonally adjusted year-on-year performance by value and volume, 2022-23
                                        • Figure 29: BPC Tracker: shopping behaviour, 2023
                                      • Key financial updates from non-food retailers in Q1
                                        • Quiz reports revenue of £91.7 million
                                          • Moss Bros to expand onto other digital marketplaces
                                            • Next profits and sales rise
                                              • Levi’s reports 41% drop in net income
                                                • LK Bennett reports a 30% increase in turnover
                                                  • Seasalt reports uptick in profits and sales for the financial year 2022
                                                    • Burberry reports revenues up by 10%
                                                      • H&M reports net sales grew 12% for the first quarter of 2023
                                                        • Primark reports a surge in sales
                                                          • M&S reports increase in sales
                                                            • Shoe Zone posts a 7.9% growth in sales
                                                              • Gymshark profits drop due to soaring operational and production costs
                                                                • N Brown reports fall in revenues due to challenging online market conditions
                                                                  • Sosandar reports revenues up 72%
                                                                    • ASOS losses widen as sales drop
                                                                      • Boohoo revenues and profits fall in its year-end results
                                                                        • Dr Martens sales hit £1 billion but profits take a tumble
                                                                          • JD Sports posts a 12% increase in total revenue
                                                                            • Watches of Switzerland delivers a strong performance
                                                                              • B&M reports declining profits due to rising operational costs
                                                                                • Poundland owner sees sales grow despite challenging environment
                                                                                  • Kingfisher blames poor weather for lower sales
                                                                                    • Topps Tiles sales grow 9.5% for the 26 weeks leading up to April
                                                                                      • Homebase reports its biggest sales week since Easter
                                                                                        • Currys lifts profit outlook as UK delivers strong performance
                                                                                          • Dunelm Q3 sales increase 6% year on year
                                                                                            • Boots reports 16% increase in sales for the three months leading to February
                                                                                              • The Works posts rising sales despite a challenging backdrop
                                                                                                • WH Smith travel arm boost profits and sales
                                                                                                  • Card Factory profits triple due to strong store-based sales
                                                                                                    • Bensons for Beds reports A 9%Iincrease in Like-For-Like Sales In Q2
                                                                                                      • Wickes reports a decline in profits as it experiences record sales
                                                                                                      • Launch Activity and Innovation for Q1 2023

                                                                                                          • Sainsbury’s launches Nectar Prices
                                                                                                            • Asda launches autonomous deliveries in London
                                                                                                              • Figure 30: Asda and Wayve autonomous delivery trial, 2023
                                                                                                            • Aldi dims lights across all stores to combat rising energy costs
                                                                                                              • Asda introduces 150 new product lines to celebrate its biggest Ramadan yet
                                                                                                                • Figure 31: Asda 2023 Ramadan product range examples, 2023
                                                                                                              • John Lewis adds maternity wear to its rental offering
                                                                                                                • Rixo opens London flagship store
                                                                                                                  • Mamas & Papas launches resale initiative
                                                                                                                    • M&S set to freeze prices on school uniforms
                                                                                                                      • Figure 32: M&S school uniform, 2023
                                                                                                                    • Zalando set to launch virtual assistant tool powered by ChatGPT
                                                                                                                      • Figure 33: Zalando ChatGPT powered fashion assistant, 2023
                                                                                                                    • ASOS launches ScaleUP to bridge the gap for ethnic minority-owned brands
                                                                                                                      • eBay launches Better Than New Homewares Hub
                                                                                                                      • Special Focus: Customer Loyalty in Retail

                                                                                                                          • High engagement for loyalty schemes
                                                                                                                            • Figure 34: Membership of customer loyalty scheme and paid subscription pass, May 2020 and March 2023
                                                                                                                          • Cost-of-living crisis driving consumers to loyalty schemes
                                                                                                                            • Figure 35: Attitudes towards customer loyalty behaviours, 2023
                                                                                                                          • Points and discounts most valued in loyalty schemes
                                                                                                                            • Figure 36: Important factors in a loyalty scheme, any rank, 2022
                                                                                                                          • Most define loyalty by regular use of products and services
                                                                                                                            • Figure 37: Definitions of loyalty behaviour towards a retailer/brand, 2023
                                                                                                                          • Brand affinity easily swayed by a change in price
                                                                                                                            • Figure 38: Factors that would cause consumers to stop shopping at a retailer/brand, 2023

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