After a turbulent year, the retail Christmas trading period has officially kicked off. Before I detail the various forecasts and trends that the NRA expects to see over the next six weeks, I’ll begin by addressing the latest COVID outbreak in South Australia. At the time of writing, a cluster of 18 new cases has occurred in the northern outskirts of Adelaide. While the extent of this outbreak is yet to be known, it has already seen the South Australian Premier announce a raft of new restrictions. Most notable to retail is a cap of 100 people with one per four square meters at clubs, pubs and restaurants.
We will continue to keep all of you updated in the coming days, but fingers crossed this outbreak in South Australia is quickly contained and does not result in the imposition of any further business restrictions.
Notwithstanding the above news emanating out of South Australia, the NRA is optimistic that this festive season will mark the start of a retail recovery. There are signs that Australians do have more discretionary power than usual, due to factors such as being unable to travel overseas, the continuation of government assistance measures and a thirst to get out of the house following periods of lockdown.
Indeed, the Westpac consumer sentiment survey released last Thursday revealed that consumer confidence rose in early November to the highest level in seven years. Economists are also predicting a housing market resurgence due to the start of deferred loan repayments, providing further hope that the economy is heading in the right direction.
Overall, the NRA is forecasting total retail sales across the Christmas period – the second-half of November and all of December – to break the $50 billion mark. We’re anticipating increased turnover on Christmas 2019 across each state and territory, as well as online spending to total more than $5 billion.
One trend that we’re particularly certain will continue is consumers finalising their Christmas shopping earlier than has traditionally been the case. Events such as Black Friday and Cyber Monday have resulted in many consumers purchasing gifts in late November as they look to capitalise on bargain prices. Online shopping has been on the rise for several years, but this has certainly been accelerated by COVID-19. Many of you would have expanded your digital services following the lockdown period and this has seen more Australians embrace online shopping.
But for those of you who operate in bricks and mortar stores, have no fear. Sales transactions in physical stores will once again account for the overwhelming number of Christmas purchases and consumers will again stampede shopping centres in the lead up to Christmas and Boxing Day.
A state-by-state breakdown of all forecasts and the projected online spend is tabled below:
|STATE||2019 Spend||2020 Forecast Spend||% Increase from 2019|
|NSW||$15.9 Billion||$16.7 Billion||5%|
|VIC||$13.2 Billion||$13.8 Billion||4%|
|QLD||$10 Billion||$10.6 Billion||6%|
|SA||$3.2 Billion||$3.3 Billion||4%|
|WA||$5.2 Billion||$5.5 Billion||6%|
|TAS||$1 Billion||$1.05 Billion||5%|
|NT||$419 Million||$431 Million||3%|
|ACT||$931 Million||$978 Million||5%|
|TOTAL||$49.9 Billion||$52.4 Billion||5%|
|ONLINE SALES||2019 Spend||2020 Forecast Spend||% Increase from 2019|
|TOTAL||$3.4 Billion||$5.2 Billion||53%|
As noted above, online retail continues to grow at a significant rate. For those of you operating in the digital sphere, now is the time to ensure that you have a strategy in place which allows your business to capitalise on this growth area. To help you get on track and maximise every opportunity available, we’ve partnered with Digital Marketing Specialist NetStripes to provide a series of power-packed 90-minute webinars.
‘Digital Marketing Essentials’ and ‘Innovation for Profitability’, developed and hosted by Digital Marketing Expert Dinesh De Silva will empower you with the knowledge for a successful digital transition and guide you to achieve exponential growth this coming season. It’s completely free and I encourage all of you to register here.
Finally, our partners at Roubler are also providing a free webinar on dealing with adversity when running your own business. As we navigate a highly disruptive time like the present it’s important that retailers are equipped for the emotional challenges that come with making difficult decisions. If you’re looking for tips to ensure that you show up for your business, your team and yourself when the going gets tough, then I recommend you register here.
All the best for the week ahead.