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Retail

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Contactless payments account for 51% of card sales

New data from Barclaycard’s Contactless Spending Index has revealed that 51 per cent of in-store transactions are made using ‘touch and go’ technology, up more than a third (34%) since the beginning of the year.
Industry body UK Cards Association (UKCA) has also revealed that credit and debit payments have doubled in the past 10 years, with the increased use of contactless driving the surge.
“Our data shows that growth in contactless spending has been surging for several years, but this latest insight is particularly significant as it shows shoppers now prefer to pay with ‘touch and go’, with more than half of eligible transactions made this way,” commented Adam Herson, mobile payments director, Barclaycard.
“September will mark the tenth anniversary of Barclaycard introducing contactless to the UK and during this time we’ve seen the technology evolve at a rapid pace – from mobile and wearable devices – to invisible payments such as our newly launched ‘Grab+Go’ concept, which allows consumers to scan and pay for their shopping with a smartphone.
“And with more innovation in the pipeline and a continued rise in consumer and merchant adoption, 2017 is on track to be another record-breaking year for contactless spending.”
Use of contactless has increased in the Midlands and the North of England more than anywhere else in the UK, with the biggest jumps in spending seen in Derby (up 45%), Chester (44%), Newcastle Upon Tyne (42%), Coventry (42%) and Stoke-on-Trent (41%).

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UK retail sales slump in May

A rise of 2.7% in inflation, the highest level in nearly four years, has had a dramatic effect on retail with sales suffering a 0.4% drop through the month of May.

The figures released by the British Retail Consortium (BRC) show that sales rose 0.2% in May, against a 1.4% in May 2016, the lowest since January, excluding Easter Bank Holiday distortions.

The report also details how Food sales increased 3.2% on a like-for-like basis over the three months to May, 4.3% on a total basis – the highest three-month growth since 2012 rising 3.2% in the quarter to May.

Over the same period, Non-Food retail sales in the UK decreased 0.3% on a like-for-like basis and increased 0.1% on a total basis, making it the worst performance recorded since may 2011.

Online sales of Non-Food products grew 7.0%, while in-store sales declined 1.8% on a Total basis and 2.3% on a like-for-like basis, below the like-for-like 12 month average decline of 2.0%.

Commenting on the figures, Helen Dickinson OBE, chief executive British Retail Consortium, said: “After the pick-up in sales over Easter, consumer spending slowed again in May resulting in almost flat growth on the previous year. Underneath the headlines, there’s continued variation in the performance of food versus non-food products, as sales performance of the two become increasingly polarised.

“Food sales, albeit positively distorted by inflation, continue to see annual growth, while in non-food categories which are predominantly capturing discretionary spending, retailers find themselves having to compete even harder.
“Overall, May’s sales slowdown is indicative of a longer term trend of a decline in consumer spending power. As household budgets become increasingly squeezed by inflation, predominantly in the non-retail part of the consumer basket, it’s vital that the next Government helps retailers keep prices low for ordinary shoppers. This means, as well as securing a tariff-free trade deal with the EU, negotiating frictionless customs arrangements; providing certainty for EU colleagues working in the UK; and ensuring the continuity of existing EU legislation as it transfers into UK law.”

Paul Martin, UK head of retail added:“After the surge in retail sales last month – the by-product of this year’s relatively late Easter – retailers have been brought back down to earth with a thump. Like-for-like retail sales contracted in May, which is likely to represent a more accurate depiction of the state of UK retail currently.
“The impact of inflationary pressures on the nation’s purse continues to play out in this month’s figures, with shoppers evidently spending more on food and drink than on non-food purchases. With inflation continuing to rise and wage growth stagnating, consumers are starting to feel the pinch – although the highly competitive nature of the UK grocery market continues to play out in the consumer’s favour.

“Many retailers, particularly fashion stores, will be poised and ready to make the most of the upcoming summer, so hopefully the weather will play fair. An increased focus on managing costs will dominate the retail agenda. More imminently though, eyes will be firmly placed on the outcome of the General Election, with close attention being paid to the implications it might have on the industry.”

www.brc.org.uk

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Tesco and Dixons Carphone forge new deal

Tesco has confirmed a new deal with Dixons Carphone to trial concessions within some of the retailer’s largest supermarkets.

Dixons Carphone, which owns tech retailer Currys PC World, will launch two new outlets this summer in Tesco Extra stores located in Milton Keynes and Northampton.

Both concessions will stock a range of Currys PC World products, including white goods, computers, televisions and accessories, along with Dixons Carphone laptop repair service.

In a direct response to its key rival Sainsbury’s inclusion of Argos stores, Tesco said the new partnership would offer customers the “best possible range of services”.

Both stores will be on trial for a year before any decisions are made regarding further roll-outs.

“We’re always looking at ways to offer our customers the best possible range of services in our stores,” Tesco UK chief executive Matt Davies said.

“We think this is a winning combination for customers and look forward to opening the first outlet in our Milton Keynes store in July.”

Dixons Carphone’s UK and Ireland chief executive Katie Bickerstaffe said: “Customers tell us they want to pick up the latest electrical products conveniently and at competitive prices, with expert advice and from someone they trust to keep them working seamlessly.

“This trial gives them all of this during a weekly grocery shop, which we hope they will enjoy.”

 

 

 

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Which? reveals best and worst on High Street

A survey by consumer watchdog Which? of over 10,000 consumers has revealed the best and worst shops on the High Street.

The customer scores given are based on customers’ experiences of purchasing non-food items, satisfaction levels and likelihood of recommending each shop.

DIY store Toolstation is joint-top for the second year running (having shared first place with John Lewis in 2016), while Richer Sounds is in the number one spot after coming joint-third last year. The electrical chain last topped the Which? survey in 2011.

Harvey Nichols has jumped from 21st place last year to third place this time around, with customers citing a love of its products as well as the stores themselves.

Waterstones returns to the top five for the first time since 2014. The book retailer is welcomed back into the top bracket of the Which? shopping survey on the back of recent news that book sales reached a record £3.5 billion last year.

“The best retailers, Richer Sounds and Toolstation, continue to strike the right balance by selling quality products at reasonable prices,” commented Richard Headland, editor of Which? magazine. “It’s a simple formula, but that’s why they consistently score well with shoppers in the Which? survey.”

Top rated shops:
• (1) Richer Sounds – 80% (128)
• = Toolstation – 80% (132)
• (3) Harvey Nichols – 79% (118)
• = John Lewis – 79% (542)
• = Waterstones – 79% (266)
• (6) Apple – 78% (129)
• = Bodycare – 78% (213)
• (8) The Perfume Shop – 77% (209)
• (9) Card Factory – 76% (218)
• = Cotswold Outdoor – 76% (125)
• = Go Outdoors – 76% (192)
• = Screwfix – 76% (186)

Bottom  rated shops:
• (88) Clinton Cards – 62% (128)
• = JD Sports – 62% (191)
• = Robert Dyas – 62% (232)
• = Sainsbury’s – 62% (278)
• = Tesco – 62% (264)
• = Topshop/Topman – 62% (181)
• (94) EE – 61% (146)
• = Peacocks – 61% (224)
• = Vodafone – 61% (134)
• (97) Poundstretcher – 60% (263)
• (98) Poundland – 59% (103)
• (99) WH Smith – 56% (225)
• (100) Morrisons – 55% (153)

Numbers in brackets represent the number of responses for each retailer.

Full results of the survey can be viewed here

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April retail footfall boosted by Easter shopping

Figures released by the British Retail Consortium (BRC) Springboard Footfall & Vacancies Monitor revealed a 1.6% growth in footfall in April compared to 2016, above the average three-month growth of 0.7% and the fastest growth month in shopper numbers for three years.

The news comes after a difficult March trading period, which saw retail sales drop 1.0% from March 2016.

The April figures mark the first positive quarter since May 2014, with consumer spending dropping in the 10 months since Britain voted for Brexit and the average consumer feeling the impacts of rising inflation. However, the April figure is likely to be distorted due to the late timing of Easter this year.

“As expected, the Easter holidays provided the welcome boost to retail sales, which goes some way to making up for the disappointing start to the year,” Helen Dickinson, the BRC’s chief executive said.

“The inclusion of the holidays in this period will have distorted this figure but even looking beyond this, the picture over the last quarter has been largely positive.”

Paul Lewis, senior director of marketing at Voucher Codes and RetailMeNot urged retailers to take a smart approach to counter strenuous trading conditions for consumers and make the most of the bank holiday at the end of the month by ensuring digital and physical work together to increase overall sales figures.

“Last year, VoucherCodes.co.uk, part of RetailMeNot discovered that mobile devices unlocked £200 million sales in-store, therefore as we get closer to the May half term and Summer holidays, retailers could be expecting a busy shopping weekend on the high street,” commented Lewis.

“Shopping is no longer divided into the plain and simple clicks vs bricks – the lines are blurred now more than ever and consumers expect to switch between the two experiences seamlessly.

“Shoppers want to investigate competitor prices, check stock location and read consumer reviews all whilst standing right there within the store.”

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Rise in fuel prices hits UK retail

The Office for National Statistics (ONS) has revealed that UK Retail sales increased by 3.7% in February 2017 compared with the same period 12 months earlier and increased by 1.4% compared with January 2017 across all store types.

However, the underlying pattern suggested by the three-month on three-month movement decreased by 1.4% for the second month in a row, which is the largest decrease since March 2010 and only the second fall in December.

“February’s retail sales figures show fairly strong growth, though the underlying three-month picture shows falling sales as February’s figures follow two consecutive months of decline in December and January,” said ONS statistician Kate Davies.

 “The underlying trend suggests that rising petrol prices in particular have had a negative effect on the overall quantity of goods bought over the last three months.”

The ONS reports an average of £1.20p forecourt price for a litre of petrol in February, with diesel 3p more.

The rise in fuel and food costs pushed inflation beyond the Bank of England’s 2% target in February to hit its highest level since September 2013, with the ONS reporting that the Consumer Price Index (CPI) measure of inflation rose from 1.8% in January to 2.3% last month.

The move – the first above-target rise since November 2013 – will increase pressure on the Bank’s Monetary Policy Committee (MPC) to increase interest rates beyond 0.25% in 2017.

ONS deputy national statistician Jonathan Athow said: “Inflation has risen to its highest rate for almost three-and-a-half years with price increases seen across a range of items but with food and fuel having the largest impact.”

www.ons.gov.uk

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Customer service to ‘compete with Amazon’

Self-serve locker systems are being prepared to allow rival online retailers to compete with Amazon Go.

Apex Supply Chain Technologies have revealed their new Apex AnyWhere line of self-serving automated systems at this year’s National Retail Federation (NRF) Convention.

The customer-facing, click and collect lockers aim to speed up and improve customer experiences with food and retail services by focussing on improving ‘last inch’ delivery, streamlining mobile ordering and working to ensure products reach customers as simply as possible.

“The technology Apex has on display at NRF shows the breadth and depth of our response to the rapidly changing retail landscape,” says Kent Savage, Apex Supply Chain Technologies founder and CEO, “they need to automate inefficient, manual processes and leverage the power of accurate inventory data.”

Traditionally manual processes such as managing handheld scanners, tablet computers and other inventory-tracking techniques run the risk of wasted time, which in turn wastes money.

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Apex aims to boost productivity and convenience in order to cause a decrease in customer queue times as well as allow employees to serve customers more quickly.

A large and increasingly growing competitor is Amazon, who already offers a highly streamlined and customer friendly interface.

Already implementing click and collect technology, drone delivery on the horizon and the announced Amazon Go to take on the high street retailers, Apex is hoping they can level the playing field.

“As bricks and mortar retailers race to reimagine and reinvent themselves to compete with Amazon and other ecommerce competitors, they must think differently,” said Mr Savage, “they can develop a competitive edge by embracing [online]-connected devices, like those we are showing at this year’s NRF show.”

 

 

Genration Z

‘Digitally Native’ generation still prefer shops

New figures reveal the first fully ‘digitally native’ generation still prefer brick and mortar shopping to online browsing.

Released by IBM and the National Retail Federation, the study reveals a massive majority of ‘Generation Z’ consumers between the ages of 13-21 still prefer physical shopping environments.

Specifically described as being born between the mid-1990s and early 2000s, Generation Z are the first children to grow up into the digital age, into a world of mobile phones, home computing and the internet.

67% of Generation Z prefer shopping in-store most of the time, with a further 31% still often shopping on high streets, indicating that just 2% of the ‘always on’ generation only shop online.

“Just as Millennials overtook Gen X, there’s another big buying group retailers need to plan for, and it’s even larger: Generation Z,” National Retail Federation President and CEO Matthew Shay said. “They appreciate the hands-on experience of shopping in a store.”

The global population of ‘Gen Z’ is set to reach 2.6 Billion by 2020, and are expected bring a huge amount of buying power, as estimates suggest the new generation have access to around $44 billion in disposable income.

66% say that product quality and availability are the top factors when choosing brand, although value is another major focus as over half admit to a lack of brand loyalty compared to other generations.

As technology is continuing to evolve, and eCommerce has changed to reflect that, a main concern for retail has been to not get left in the dust, with Mr Shay explaining that retailers need to continue to be “agile” if they want to stay relevant.

“Retailers are constantly focused on experimenting with new innovations both online and in-store to remain relevant to evolving consumer demand.”

 

Yankee Candle

Yankee Candle teams up with Toshiba for service revamp

Yankee Candle is preparing to deploy 1,400 Toshiba systems across stores in order to future-proof its business.

As it modernises its retail offering, the leading candle company will transform its point of sale with the Toshiba TCxWave.

“As the most recognized brand in the candle business, we are delighted,” said Toshiba Global Commerce Solutions’ US head of sales VP, Bill Campbell, who believes Toshiba will help Yankee Candles deliver “enriched shopping experiences for their customers, as well as a frictionless checkout.”

The technology offers a versatile design, and gesture touch-based screens, and will be set up across stores in the United States as well as Britain.

“We selected Toshiba’s [point of sale] solutions to support our new retail infrastructure,” explained Dave Harris, vice president of IT at Yankee Candle, who chose the company due to the “unique design, durability, product road map and ability to strengthen our customer engagement.”

Yankee Candle currently sells its products across 35,000 stores worldwide, but is hoping that further improvements to their own stores will encourage more customers to shop direct.

 

 

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Industry Spotlight: Technology Trumps Tradition

With retailers constantly seeking new ways to interact with customers, digital technology has emerged as a way to deliver more relevant and engaging content. But how much notice do customers actually take?

A report released by global marketing solutions and communications provider, APS Group, uncovers some of the mysteries of customers’ interaction with store signage.

By using eye-tracking technology to measure the reactions of more than 1.6m shoppers, the study finds that almost double the number of people looked at and engaged with shop window displays if the retailer used animated, digital content instead of traditional print.

Results also demonstrated that not only are digital screens more appealing, but they also enable brands to tailor their messages and offerings to give customers what they want, when and where they want it.

 

To download a free copy of the whitepaper click here.