Most retailers are cutting back on promotions – yet customers remain determined to bag a bargain.
The stage is set for a battle of wills this Christmas as retailers attempt to reduce the level of discounting while shoppers hold out for the ultimate bargain.
Data supplied to Drapers by research consultancy Retailmap indicates that the percentage of floor space on promotion on the UK high street this year could be lower than last year – although it remains higher than in 2010.
Discounting levels over the year to October 31 have dropped at the likes of Bhs – with 36% of floor space at the chain on promotion through 2012, compared with 45% last year – and Tesco, which reduced the space given over to discounted clothing to just 20%, down from 50% last year.
Richard Fitzpatrick, director of Retailmap, said last year’s discounting peak came off the back of cotton price inflation and unseasonal weather, and was unlikely to be replicated this year.
“While this year has been pretty wet, the climate is a lot more typical of what we’d expect, meaning retailers haven’t had the same issues shifting winter product that they did last year when it was unseasonably warm,” he explained.
The first week of December is historically the peak week for pre-Christmas discounting, and Fitzpatrick said analysts would be focusing on the next seven days to fully gauge the current need for Sales.
But a survey by YouGov, revealed here for the first time, suggests consumers now expect discounting as a matter of course and will wait for the best bargain.
The study of 3,339 consumers, in conjunction with private Sale etailer BrandAlley, found 53% of shoppers will wait for retailers to go on Sale this year as a result of the deals they bagged in 2011.
Nearly a quarter of respondents – 23% – said they only bought clothes and shoes if they were on Sale.
BrandAlley chief executive Rob Feldmann said: “Last year the high street was very promotional and as a result people are now sitting back and waiting for the Sales to start before buying their Christmas goods.
“People spend an average of £400 on shopping for Christmas and while in the past they might have spread this cost, they would now rather wait to see if they can get more for their money once retailers go on Sale.”