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Shopper numbers back in decline

11 7月 2008

Regional shopping centres continue to suffer worst

UNITED KINGDOM — After the surprise year-on-year growth in retail sales and traffic in May, latest figures from the Retail Traffic Index (RTI) by analysts Synovate Retail Performance – part of global research company Synovate – show that shopper footfall numbers bounced back into the red in June across the UK as a whole, but were hit worst at regional shopping centres. The number of shoppers entering non-food retail outlets in the UK fell by 1.3% in June against May and, coincidentally, by the same 1.3% against June last year. Shopper numbers to retail outlets within regional shopping centres however were down by 4.9% year-on-year as shoppers react for the second month running to fuel price increases.

Synovate Retail Performance's retail psychologist, Dr Tim Denison explains; "Nobody had seriously expected anything other than a return to negative year-on-year retail comparisons in June. Times continue to be very challenging both in the retail trade and the wider economy. Whereas over the past few years it has very much been consumer and public spending that have kept the economy growing, both have now slowed significantly with little prospect of any other sector stepping in to pick up the baton.

"For consumers, the choices are very stark: carry on shopping regardless to maintain accustomed lifestyles; ease off and cut down on unnecessary wastage and expenditure; or radically review what can be afforded by redefining 'basics' and 'luxuries' and so reset shopping behaviour to the beat of a new drum. Only the latter evokes the "R" word*, and in my opinion, consumers are not yet in this territory; they still firmly occupy the middle ground.

"Consumers have certainly embarked on a journey, however. We are seeing definite incremental changes in mindset and behaviour. Shoppers are thinking twice about where they go and how they spend their money. Regional shopping centres have certainly lost out again in June, penalised by the rapid and relentless rise in fuel prices. Rather than venture out on more distant day-trips, shoppers have preferred to visit local centres.

"Shifts in attitude and behaviour around the country are evident, but the national footfall drop in June of 1.3% year-on-year was within 0.2% of our forecast and is exactly in line with how we see retail activity progressing this year. It does not suggest that we are standing at the cliff edge. I stated in April, at the end of a 12 month downward trend that the new footfall activity plateau had been reached and that we did not expect it to fall below a 4% year-on-year deficit over the coming months, and this is still our belief. This is far short of the double-digit drop associated with performance datasets in some other sectors that would invoke the need for more desperate measures. Times are challenging and changing, but not calamitous in retail."

All enquiries for follow up or interviews with Dr Tim Denison should be directed to Theo Chalmers at Verve PR on 01908 275271 (weekdays) or 07932 004632.