February 22, 2025 • 12 mins
Diane Wehrle CEO at Rendle Intelligence and Insights joins Simon for their monthly chat about footfall trends and shopping behaviours
As the economic landscape shifts, we explore the paradox of increasing footfall yet declining sales in retail. With consumer confidence waning amidst inflation concerns and upcoming wage increases, businesses must adapt creatively to thrive in uncertainty
• Retail footfall rises by 6.6%, but sales fall by 3.2%
• Consumer confidence drops to minus 22 index score
• Inflation currently at 3%, affecting food and hospitality sectors
• Anticipated increases in National Insurance could impact businesses
• Average transaction values rise despite lower foot traffic
• Focus on innovation over cost-cutting for retail success
• February typically a slow month; preparing for changes needed
• The importance of retaining loyal customers emphasized
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to the Productivity Podcast.
It's our monthly chat with DanWohl, ceo and founder at Rendell
Intelligence and Insights.
We're in December 2024 toJanuary 2025.
Hi, di, are we full of goodnews this month?
Speaker 2 (00:14):
Well, we have some better news, Simon, which is
encouraging.
Speaker 1 (00:17):
Good good, that's what we like.
Speaker 2 (00:18):
Yep.
Speaker 1 (00:19):
Where are we at then?
Speaker 2 (00:20):
Right.
So the initial indicators camethrough right at the beginning
of the month in terms offootfall and sales from the BRC
and they were really quitepositive.
So BRC reported an increaseyear-on-year of sales of 2.6%
and their footfall data providedby Sensomatic was up by 6.6%,
which is very encouraging.
(00:41):
So that's all very strong.
Slightly later in the month,beauclair came through with
their sales data for sales intowns and cities specifically,
and that wasn't so strong.
That was actually a drop yearon year 3.2%.
So whatever's happening, peoplearen't.
That increase in footfall spendis not translating into sales
in the high street.
So good and bad.
(01:03):
So our high streets are beingchallenged.
At the same time, otherindicators have come through.
Of course, the consumerconfidence from JFK Confidence
has weakened down to an indexscore of minus 22, from minus 17
in December and minus 19 inJanuary last year.
(01:25):
So people aren't feeling quiteas confident, or even feeling
less confident than they were.
As we all know, inflation hasgone up a little bit.
This is now sitting at 3% and alot of that is food inflation,
but also inflation inrestaurants and hotels, so
hospitality inflation as well.
(01:47):
So, yes, some good stuff andsome not so good stuff out there
.
So it's sort of steady as shegoes really, but the ONS came
through with their sales datatoday as we're speaking, they've
just released sales data forJanuary, and that's in positive
territory as well.
So, on the whole, not too badat all, although, as I said,
high streets are stillchallenged in capturing that
(02:10):
spend.
Speaker 1 (02:11):
So we're kind of in this holding.
If it was a plane, we'd becircling above the runway,
wouldn't we waiting for a space?
But I suppose the space we'rewaiting for here is the
understanding of April.
Probably not April the 1st, theend of April.
We're waiting for here is theunderstanding of April probably
not April the 1st, the end ofApril the true impact to bottom
line for any business, withpeople, for the NI and national
(02:32):
living wage increases.
That's what people are gearingfor.
So it feels like we're all justwaiting with bated breath to
see what happens, because thatcould push inflation higher,
which will then impact interestrates when I'm the economist and
then, I assume, will impactunemployment.
Speaker 2 (02:53):
Absolutely.
I mean, I think the employmentthing is where consumer
confidence is being hit.
I think people are feelinginsecure and vulnerable around
their employment.
Vulnerable around theiremployment.
I know that you know, speakingjust sort of, you know, just
speaking with friends andcolleagues.
Businesses are reorganisingstructures and processes to try
(03:14):
and become more efficient andtry and reduce their impact of
the NI vulnerability.
So that is impacting consumerconfidence and of course, that
flows straight through to areluctance to spend.
So, whilst footfall's gone up,whether or not they're actually
spending money when they'regoing into stores is a whole
different thing.
You know, there's a lot ofbrowsing going on, there's a lot
of price comparison going on,um, so you know, people are just
(03:38):
very, very cautious because,they said, you know what affects
their, their employers affectsthem and that I suppose that
impact on interest rates is achallenge because, as we
mentioned a couple of times onprevious pods, February is the
next kind of cliff for fixedrate mortgage deals to end,
isn't it?
Speaker 1 (03:55):
So that'll impact people in terms of hoping for a
better percentage deal.
Speaker 2 (04:00):
Interestingly, when the inflation result came out, I
was reading the Guardian andeven the experts can't agree
with what's going to happen.
The Bank of England is sayingthat it's going to go up to 3.7
percent inflation and a lobbygroup is saying that they think
(04:22):
it's going to go down.
So you know, this uncertaintyfeeds through into interest
rates, which then permeatesthroughout the economy, and the
biggest overhead, of course, formost households is their
mortgage, and if they're sittingat that cliff face waiting to
swap over to another mortgageagreement, that's going to have
a massive impact.
Speaker 1 (04:41):
And that then typically means if we cast our
minds back probably to some ofthe earlier podcasts last year
that we tend to rein in on highvalue goods, focus more on the
day-to-day food and beveragefashion clearly has been a
tricky market for for a longtime now, but I think it was
kind of food and health andbeauty that were relatively
(05:02):
stable or in growth for most oflast year.
Everything else becomes morediscretionary.
Speaker 2 (05:07):
Absolutely.
I mean, you know there's onlyso much you can afford to spend
from your household budget.
So the ONS results came throughon retail sales and they were
positive in terms ofyear-on-year results and
month-on-month results.
Actually, year-on-year overall,in terms of volumes they're 1%
up.
Food was 0.4% up what they calltextile, clothing and footwear.
(05:32):
So essentially, fashion, down3.8 percent.
You know, so you can see wherepeople are spending their money.
Um, they are just, you know,being much more careful around
what they're spending.
Speaker 1 (05:43):
They're going back to the basics yeah, yeah, which
ties back in with what we talkedabout kind of earlier last year
and that, again reading thepapers over this last weekend,
there's now rumours that thegovernment are looking to kind
of clearly stimulate spend,which, ironically, was what the
whole NI National Living Waysthing was supposed to do.
But let's not get too politicalaround things like closing cash
(06:04):
ices to force people to spendrather than save.
So again, there's lots ofconflicting views and messages
in there about what we should orshouldn't be doing and
ultimately people becomecautious, don't they?
And therefore they don't spend.
Speaker 2 (06:18):
Absolutely, and I think you know the evidence of
that is very clear, you know.
You only have to look at theONS information on savings, you
know, and savings are still at10%, which is the highest
they've been since the pandemic.
People are stashing money awayfor a rainy day just because of
the uncertainty.
We don't know where we're goingto be, and you read newspaper
articles and you know, you readit, and if the experts can't
(06:40):
agree where we're going, thenwhat hope is there for the rest
of us?
So people are simply A tryingto replenish their savings pot
from when inflation was indouble digits, but then also
trying to think about the worstcase scenario and make sure that
they've got enough buffer incase they lose the job.
Speaker 1 (06:55):
Yeah.
So I suppose we're going toenter a strange period of time
now, aren't we?
February is typically a lowtrade period as people recover
from Christmas, spend, get readyfor Easter, so in any retailer
it's normally one of the fallowmonths.
And hospitality just because ofgeneral money, easter's, april
(07:17):
this year, which ties in withthe NI and National Living Wage
stuff.
So the next couple of pods willbe quite interesting, I I think
in terms of if we continue tosee inflation grow, what happens
with interest rates, what theONS figures and the Beauclair
figures say, because really Ithink by the time we're in,
we're in May, hopefully we havea more stable view and read of
(07:38):
the economy and where we're at,which will hopefully give people
some confidence to spend andreplenish the reserves.
Speaker 2 (07:46):
Absolutely.
I mean, I think that the keything for the next month or two
is inflation, because that'sgoing to drive any change in
interest rates, which will thendrive consumer confidence or not
.
So you're absolutely right,it's a fallow month.
It's wait and see what happenswith inflation.
That's the indicator that we'veall got to look at for um and
um.
Speaker 1 (08:04):
we'll see where we go from there yeah, and my I
suppose my worry is being quiteknee-deep in some of this and I
and national living wage stuffwith various retailers,
hospitality companies, andhelping them think through the
longer journey.
If they run out of runway toapril and getting their plans in
place, the obvious thing to dois put cost up, which will then
(08:25):
drive inflation.
So we're back round in thiskind of holding pattern.
Speaker 2 (08:30):
Well, of course, yeah , we've already seen inflation
go up from 2.6 to 3 in one month.
So it's starting.
You know, and you know a lot ofretailers the margins are so
thin that they can't afford toabsorb it.
This just simply doesn't enablethem to retain a viable
business.
So it's going to be passed.
So I think we are going to seean increase in inflation to at
(08:51):
least 3.5%, maybe 4%.
Speaker 1 (08:53):
On a positive note, there's some really good
creative stuff happening therethat's maybe not hit the high
streets or the restaurants yet,from where people are trying to
not pass all the cost on toconsumers but be creative.
Certainly lots offorward-thinking companies
thinking more about drivingadditional services, average
transaction value by being moreattentive and having better
(09:16):
quality service than justcutting costs.
So there's a real mixed bag ofpeople slashing cost, which can
be very blunt and havesignificant long-term impacts,
not not so good and detrimentalsometimes to those organizations
themselves.
But this round of challengeswe're seeing people thinking
creatively and I have to say theones that are thinking
(09:38):
creatively I think will, willprosper, won't necessarily pass
all that cost on to customers,which can only, again, only be a
benefit.
Speaker 2 (09:46):
No, I mean actually I'm glad you mentioned average
transaction value because that'sone of the metrics that
Beauclair report on.
They look at number oftransactions made by customers
in high streets, the number ofcustomers who are actually
purchasing in high streets, andthen their average transaction
value.
And average transaction valuehad increased last month by 1.8%
(10:08):
from January last year andactually by 2.6% in fashion and
3.6% in health and beauty.
So you know people are spendingmore.
There are just fewer customersbuying.
So you know retailers reallyneed to focus on their customer
base those who are buying andtry and exploit that and up that
ATV because that's going tomove the dial.
Speaker 1 (10:30):
Yeah, I think again we talked about it on a couple
of previous episodes it's got tobe a key metric for at least
the next 12 months in anyselling, customer-facing
organization or driving ATV,because getting new customers is
really, really tricky.
Absolutely, you've got to bemaximizing what you've got and
making it important to them,connecting with them you know
there's all the instagram socialstuff these days but ultimately
(10:52):
helping them part with moneywith you rather than competitor
or nobody, because then itbecomes the worst of all worlds
yeah, absolutely, and we'vetalked a lot in retail over the
last few years about community,about loyalty, um, and you know,
interaction and it's never beenas important as it is now.
Speaker 2 (11:11):
You know it's so much cheaper to interact with
existing customers.
They've proven they like yourbrand, whatever that brand is.
Um, don't lose them, whateveryou do.
You know, even if you give thema discount or just retain them
and then try and drive up atvfrom there are so important yeah
, so positive note to finish on.
Speaker 1 (11:29):
Then, lots to play for, yeah, I suppose.
Give, give your customers whatthey want within, within the
realms of reality, of course, uh, but yeah, atv has to be the,
the primary focus to, to driveadditional revenue, and the more
revenue it's not rocket science, but again basic economics the
more you can drive revenue rise,the more margin you make, the
less painful, hopefully, thechallenges that we're facing
(11:51):
into become.
Speaker 2 (11:52):
Absolutely absolutely .
Speaker 1 (11:53):
Perfect.
Well, let's see what next monthbrings, fingers crossed.
It's relatively stable but, asI say, it feels like we're in
that holding pattern now untilkind of mid-year, when
everything comes into effectyeah, I think you're right.
Speaker 2 (12:08):
Um, it will be interesting in february, and
very interesting because thejanuary is difficult because
we're coming out of christmasand you get a very distorted
view of things.
But february we'll start to seeslightly more but a slightly
bigger window on thingsbrilliant.
Speaker 1 (12:21):
Thanks as ever, die, and we'll catch up next month
thanks, simon.
Welcome to the Productivity Podcast.
It's our monthly chat with DanWohl, ceo and founder at Rendell
Intelligence and Insights.
We're in December 2024 toJanuary 2025.
Hi, di, are we full of goodnews this month?
Speaker 2 (00:14):
Well, we have some better news, Simon, which is
encouraging.
Speaker 1 (00:17):
Good good, that's what we like.
Speaker 2 (00:18):
Yep.
Speaker 1 (00:19):
Where are we at then?
Speaker 2 (00:20):
Right.
So the initial indicators camethrough right at the beginning
of the month in terms offootfall and sales from the BRC
and they were really quitepositive.
So BRC reported an increaseyear-on-year of sales of 2.6%
and their footfall data providedby Sensomatic was up by 6.6%,
which is very encouraging.
(00:41):
So that's all very strong.
Slightly later in the month,beauclair came through with
their sales data for sales intowns and cities specifically,
and that wasn't so strong.
That was actually a drop yearon year 3.2%.
So whatever's happening, peoplearen't.
That increase in footfall spendis not translating into sales
in the high street.
So good and bad.
(01:03):
So our high streets are beingchallenged.
At the same time, otherindicators have come through.
Of course, the consumerconfidence from JFK Confidence
has weakened down to an indexscore of minus 22, from minus 17
in December and minus 19 inJanuary last year.
(01:25):
So people aren't feeling quiteas confident, or even feeling
less confident than they were.
As we all know, inflation hasgone up a little bit.
This is now sitting at 3% and alot of that is food inflation,
but also inflation inrestaurants and hotels, so
hospitality inflation as well.
(01:47):
So, yes, some good stuff andsome not so good stuff out there
.
So it's sort of steady as shegoes really, but the ONS came
through with their sales datatoday as we're speaking, they've
just released sales data forJanuary, and that's in positive
territory as well.
So, on the whole, not too badat all, although, as I said,
high streets are stillchallenged in capturing that
(02:10):
spend.
Speaker 1 (02:11):
So we're kind of in this holding.
If it was a plane, we'd becircling above the runway,
wouldn't we waiting for a space?
But I suppose the space we'rewaiting for here is the
understanding of April.
Probably not April the 1st, theend of April.
We're waiting for here is theunderstanding of April probably
not April the 1st, the end ofApril the true impact to bottom
line for any business, withpeople, for the NI and national
(02:32):
living wage increases.
That's what people are gearingfor.
So it feels like we're all justwaiting with bated breath to
see what happens, because thatcould push inflation higher,
which will then impact interestrates when I'm the economist and
then, I assume, will impactunemployment.
Speaker 2 (02:53):
Absolutely.
I mean, I think the employmentthing is where consumer
confidence is being hit.
I think people are feelinginsecure and vulnerable around
their employment.
Vulnerable around theiremployment.
I know that you know, speakingjust sort of, you know, just
speaking with friends andcolleagues.
Businesses are reorganisingstructures and processes to try
(03:14):
and become more efficient andtry and reduce their impact of
the NI vulnerability.
So that is impacting consumerconfidence and of course, that
flows straight through to areluctance to spend.
So, whilst footfall's gone up,whether or not they're actually
spending money when they'regoing into stores is a whole
different thing.
You know, there's a lot ofbrowsing going on, there's a lot
of price comparison going on,um, so you know, people are just
(03:38):
very, very cautious because,they said, you know what affects
their, their employers affectsthem and that I suppose that
impact on interest rates is achallenge because, as we
mentioned a couple of times onprevious pods, February is the
next kind of cliff for fixedrate mortgage deals to end,
isn't it?
Speaker 1 (03:55):
So that'll impact people in terms of hoping for a
better percentage deal.
Speaker 2 (04:00):
Interestingly, when the inflation result came out, I
was reading the Guardian andeven the experts can't agree
with what's going to happen.
The Bank of England is sayingthat it's going to go up to 3.7
percent inflation and a lobbygroup is saying that they think
(04:22):
it's going to go down.
So you know, this uncertaintyfeeds through into interest
rates, which then permeatesthroughout the economy, and the
biggest overhead, of course, formost households is their
mortgage, and if they're sittingat that cliff face waiting to
swap over to another mortgageagreement, that's going to have
a massive impact.
Speaker 1 (04:41):
And that then typically means if we cast our
minds back probably to some ofthe earlier podcasts last year
that we tend to rein in on highvalue goods, focus more on the
day-to-day food and beveragefashion clearly has been a
tricky market for for a longtime now, but I think it was
kind of food and health andbeauty that were relatively
(05:02):
stable or in growth for most oflast year.
Everything else becomes morediscretionary.
Speaker 2 (05:07):
Absolutely.
I mean, you know there's onlyso much you can afford to spend
from your household budget.
So the ONS results came throughon retail sales and they were
positive in terms ofyear-on-year results and
month-on-month results.
Actually, year-on-year overall,in terms of volumes they're 1%
up.
Food was 0.4% up what they calltextile, clothing and footwear.
(05:32):
So essentially, fashion, down3.8 percent.
You know, so you can see wherepeople are spending their money.
Um, they are just, you know,being much more careful around
what they're spending.
Speaker 1 (05:43):
They're going back to the basics yeah, yeah, which
ties back in with what we talkedabout kind of earlier last year
and that, again reading thepapers over this last weekend,
there's now rumours that thegovernment are looking to kind
of clearly stimulate spend,which, ironically, was what the
whole NI National Living Waysthing was supposed to do.
But let's not get too politicalaround things like closing cash
(06:04):
ices to force people to spendrather than save.
So again, there's lots ofconflicting views and messages
in there about what we should orshouldn't be doing and
ultimately people becomecautious, don't they?
And therefore they don't spend.
Speaker 2 (06:18):
Absolutely, and I think you know the evidence of
that is very clear, you know.
You only have to look at theONS information on savings, you
know, and savings are still at10%, which is the highest
they've been since the pandemic.
People are stashing money awayfor a rainy day just because of
the uncertainty.
We don't know where we're goingto be, and you read newspaper
articles and you know, you readit, and if the experts can't
(06:40):
agree where we're going, thenwhat hope is there for the rest
of us?
So people are simply A tryingto replenish their savings pot
from when inflation was indouble digits, but then also
trying to think about the worstcase scenario and make sure that
they've got enough buffer incase they lose the job.
Speaker 1 (06:55):
Yeah.
So I suppose we're going toenter a strange period of time
now, aren't we?
February is typically a lowtrade period as people recover
from Christmas, spend, get readyfor Easter, so in any retailer
it's normally one of the fallowmonths.
And hospitality just because ofgeneral money, easter's, april
(07:17):
this year, which ties in withthe NI and National Living Wage
stuff.
So the next couple of pods willbe quite interesting, I I think
in terms of if we continue tosee inflation grow, what happens
with interest rates, what theONS figures and the Beauclair
figures say, because really Ithink by the time we're in,
we're in May, hopefully we havea more stable view and read of
(07:38):
the economy and where we're at,which will hopefully give people
some confidence to spend andreplenish the reserves.
Speaker 2 (07:46):
Absolutely.
I mean, I think that the keything for the next month or two
is inflation, because that'sgoing to drive any change in
interest rates, which will thendrive consumer confidence or not
.
So you're absolutely right,it's a fallow month.
It's wait and see what happenswith inflation.
That's the indicator that we'veall got to look at for um and
um.
Speaker 1 (08:04):
we'll see where we go from there yeah, and my I
suppose my worry is being quiteknee-deep in some of this and I
and national living wage stuffwith various retailers,
hospitality companies, andhelping them think through the
longer journey.
If they run out of runway toapril and getting their plans in
place, the obvious thing to dois put cost up, which will then
(08:25):
drive inflation.
So we're back round in thiskind of holding pattern.
Speaker 2 (08:30):
Well, of course, yeah , we've already seen inflation
go up from 2.6 to 3 in one month.
So it's starting.
You know, and you know a lot ofretailers the margins are so
thin that they can't afford toabsorb it.
This just simply doesn't enablethem to retain a viable
business.
So it's going to be passed.
So I think we are going to seean increase in inflation to at
(08:51):
least 3.5%, maybe 4%.
Speaker 1 (08:53):
On a positive note, there's some really good
creative stuff happening therethat's maybe not hit the high
streets or the restaurants yet,from where people are trying to
not pass all the cost on toconsumers but be creative.
Certainly lots offorward-thinking companies
thinking more about drivingadditional services, average
transaction value by being moreattentive and having better
(09:16):
quality service than justcutting costs.
So there's a real mixed bag ofpeople slashing cost, which can
be very blunt and havesignificant long-term impacts,
not not so good and detrimentalsometimes to those organizations
themselves.
But this round of challengeswe're seeing people thinking
creatively and I have to say theones that are thinking
(09:38):
creatively I think will, willprosper, won't necessarily pass
all that cost on to customers,which can only, again, only be a
benefit.
Speaker 2 (09:46):
No, I mean actually I'm glad you mentioned average
transaction value because that'sone of the metrics that
Beauclair report on.
They look at number oftransactions made by customers
in high streets, the number ofcustomers who are actually
purchasing in high streets, andthen their average transaction
value.
And average transaction valuehad increased last month by 1.8%
(10:08):
from January last year andactually by 2.6% in fashion and
3.6% in health and beauty.
So you know people are spendingmore.
There are just fewer customersbuying.
So you know retailers reallyneed to focus on their customer
base those who are buying andtry and exploit that and up that
ATV because that's going tomove the dial.
Speaker 1 (10:30):
Yeah, I think again we talked about it on a couple
of previous episodes it's got tobe a key metric for at least
the next 12 months in anyselling, customer-facing
organization or driving ATV,because getting new customers is
really, really tricky.
Absolutely, you've got to bemaximizing what you've got and
making it important to them,connecting with them you know
there's all the instagram socialstuff these days but ultimately
(10:52):
helping them part with moneywith you rather than competitor
or nobody, because then itbecomes the worst of all worlds
yeah, absolutely, and we'vetalked a lot in retail over the
last few years about community,about loyalty, um, and you know,
interaction and it's never beenas important as it is now.
Speaker 2 (11:11):
You know it's so much cheaper to interact with
existing customers.
They've proven they like yourbrand, whatever that brand is.
Um, don't lose them, whateveryou do.
You know, even if you give thema discount or just retain them
and then try and drive up atvfrom there are so important yeah
, so positive note to finish on.
Speaker 1 (11:29):
Then, lots to play for, yeah, I suppose.
Give, give your customers whatthey want within, within the
realms of reality, of course, uh, but yeah, atv has to be the,
the primary focus to, to driveadditional revenue, and the more
revenue it's not rocket science, but again basic economics the
more you can drive revenue rise,the more margin you make, the
less painful, hopefully, thechallenges that we're facing
(11:51):
into become.
Speaker 2 (11:52):
Absolutely absolutely .
Speaker 1 (11:53):
Perfect.
Well, let's see what next monthbrings, fingers crossed.
It's relatively stable but, asI say, it feels like we're in
that holding pattern now untilkind of mid-year, when
everything comes into effectyeah, I think you're right.
Speaker 2 (12:08):
Um, it will be interesting in february, and
very interesting because thejanuary is difficult because
we're coming out of christmasand you get a very distorted
view of things.
But february we'll start to seeslightly more but a slightly
bigger window on thingsbrilliant.
Speaker 1 (12:21):
Thanks as ever, die, and we'll catch up next month
thanks, simon.
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