Shoppers rediscover their daily routine says Synovate
1 September 2010
UNITED KINGDOM — Synovate's Retail Traffic Index (RTI) showed a year-on-year decline of 1.8% in August, the strongest comparison against 2009 since February and marginally better than the forecast of -2.0%. The RTI, which measures the number of visits to non-food stores in the UK, stood 1.3% lower in August than in July.
"Over the course of this summer we have seen something of a steady state of return to non-food shopping in the UK after a spring of turmoil," comments Dr Tim Denison, Director of Retail Intelligence at Synovate Retail Performance. "For the past three months, national footfall figures have stabilised, hovering around two points below 2009, making us believe that shoppers are lodged in a daily routine once more and as such are getting on with everyday life. For the majority, this altered routine includes fewer shopping trips for discretionary goods, less shopping on credit and more attention on saving or repairing financial positions. We are certainly more conscious of our shopping and spending patterns than we were two years ago. Spending power is being squeezed as earnings growth continues to slip against inflation. This is expected to remain the case for the rest of this year," warns Denison.
Synovate believes that retailing is unlikely to be hit as hard, or as soon, as other social and recreational pursuits such as eating out and holidaying - there is already significant curtailment and trading down in these types of activities. Overseas travel by holiday-makers for example, is 12% down against the previous twelve months.
Inflation is more of a friend than a foe to the retailer at this point - it helps to drive sales value. However, if income growth fails to match the rising cost of living as we move into next year, market conditions are likely to get much tougher for retailers.
"There is a real risk that the timing of the VAT increase in January could come just at the wrong time, if inflation is not on the way down by then," concludes Denison. "Were inflation to remain around 3%, it would certainly put pressure on interest rates, which if raised, would have a far more significant impact on consumer incomes. In the meantime though, conditions remain in the balance and consumers are inevitably nervous about signing up to any new long-term repayment commitments while there is still pain in the pipeline."
Enquiries for interviews with Dr. Tim Denison should be directed to Joanne Taylor, joanne.taylor@synovate.com / +44 (0)20 3059 5279.
Contact(s) for this press release
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Chris Scoot
Synovate Retail Performance |
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34 Walker Avenue |
Telephone: +44 1908 682 700 |
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Joanne Taylor
Marketing Executive, Synovate UK |
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Synovate |
Telephone: +44 20 3059 5279 |
Synovate Retail Performance provides footfall monitoring solutions, shopper tracking systems and in-store behavioural research to retailers worldwide. Its core products - Shopper Count, Shopper Interact and Shopper Engage - scientifically measure all aspects of a shopper experience from store entry to exit. It supplies national and international retailers with essential business metrics to drive accountability and performance improvement.
Synovate Retail Performance is home to the Retail Traffic Index series, which for over 10 years has been the industry's leading tracker of national, regional and sector retail footfall trends. It is also co-founder of the KPMG / Synovate Retail Think Tank, offering thought leadership on the state of retail health and the future of retailing.
General information for Synovate Retail Performance, email info.rp@synovate.com
Synovate Retail Performance Limited is registered in England and Wales under number 3552625 with its registered address at Minerva House, 5 Montague Close, London, SE1 9AY, UK. Synovate Retail Performance is a wholly owned subsidiary of Synovate.
About Synovate
Synovate generates insights to help clients drive competitive brand, product and customer experience strategies. Now part of Ipsos, with offices in over 80 countries, our approach combines best in class global research capabilities with personalised service, local knowledge and the flexibility to create teams and processes that meet clients' specific requirements. At Synovate, our clients sit at the top of our organisational chart, driving us to continually develop more innovative research solutions that predict actual business outcomes.
For more information on Synovate visit www.synovate.com.