Episode Transcript
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Speaker 1 (00:00):
Welcome to the
Productivity Podcast.
Dan Will returns Retail andDestinations Insight Expert for
our chat around football trendsfrom September to October.
Hi Dike.
Speaker 2 (00:11):
Hi Simon.
Speaker 1 (00:13):
How are you?
Speaker 2 (00:13):
I'm very well.
Thank you.
Well, I have just come backfrom three weeks in Australia,
so I should not be OK.
Speaker 1 (00:19):
Well, I suspect
you've seen much better weather
and less wind and rain than wehave here.
I was going to say, if it wasat the time of recording, you
were just going.
I was expecting that you weregoing into I'm a celebrity but
you're back just before itstarted.
Speaker 2 (00:34):
Yes, I'm afraid I
interviewed and they didn't
really want me.
Speaker 1 (00:37):
Well, maybe next year
, maybe next year.
So September to Octoberfootball.
Clearly, people in retailhospitality, certainly all the
supermarkets, are giving up fortheir golden quarter.
So how are things faring as wemove into probably the most
important two months, november,december for lots of
(00:57):
organisations?
Speaker 2 (00:59):
Well, I'll start with
my forecast that I put forward
for October back in Septemberactually and I forecast that
football would be 1.3% lowerannually in October than October
2022.
And in fact, my forecast cametrue.
So it was actually lower, andit's not surprising given the
(01:20):
wind and rain that occurredduring the month.
Obviously, I was pretty immuneto it, but I did see all the
reports.
It looked pretty horrendous.
High streets and shoppingcentres drove all of that
decline and when the ONSreleased their results, that
reflected the decline infootball, so sales were down as
well, and that really shouldn'tbe surprising to anyone.
(01:42):
So it's definitely a month ofcaution.
The consumers are clearlygearing up for Christmas and,
before that, black Friday, which, at the time of recording today
, is literally three days away.
But since the October resultshave come through, inflation has
dropped a couple of points andthere's lots of good talk in the
(02:06):
market around interest ratescoming down a little bit, so
possibly Black Friday won't bequite as black as we hoped.
It might be actually quitebetter than we anticipated.
Speaker 1 (02:18):
It's interesting.
I don't know what your emailinbox has been like, but it
feels like it's Black Fridaymonth, so lots of people have
gone early, haven't they?
Again, some retailers some aremaybe the higher end fashion
coming out saying that it's notfor them in terms of the way
they price or the way theydeliver product, but it does
seem to have stretched.
Speaker 2 (02:40):
Absolutely, and I
think that's happened over the
last sort of three to four years.
When we first had Black Fridayback in 2013, 2014,.
It was a day and it became twoor three days.
Now it's at least a week, ifnot that, and of course then it
sort of slides straight intoCyber Monday.
So I mean it's an opportunityfor retailers to capture the
(03:00):
Christmas shopper, whilstpredictions for Black Friday in
terms of foot of four are not aspositive as they were last year
, still increasing from the weekbefore.
Obviously.
Actually, I think people aregoing to use Black Friday's an
opportunity to spread spending.
I know it's leading up topayday, but it is always leading
(03:22):
up to payday.
It's never moved.
So people talk about oh, thefact it's leading up to payday,
but it's always leading up topayday.
But people are going to usethat opportunity, I think, to
get out into store.
And what we found, particularlylast year, which was the first
Black Friday since COVID, isactually people use it as a sort
of kick-off Christmas shoppingday.
(03:43):
Many people actually took daysoff work to go into high streets
and shopping centres,particularly to enjoy that
Christmas spirit and see thedecorations and have lunch or
have a coffee, meet friends andcombine it and make it the first
day that they really had somepositive experience around
Christmas and then combine thatwith buying some gifts as well.
It literally is only four weekstill Christmas, so it's not
(04:06):
actually a long way away at all.
Some people are going to usethat opportunity and I think the
forecast for online spending,imrg, put out release in the
middle of October saying thatgift spending online is hugely
down this year 12.5% year onyear up to the end of September.
(04:28):
So it shows that people aren'tbuying those gifts online and
they're anticipating a dropannually of 11% revenue and
gifts over Black Friday.
So they are, you know, comingalong with my thinking in terms
of people aren't going to wantto spend on gifts online.
They want that experience,which is great.
Physical stores anddestinations.
Speaker 1 (04:49):
Yeah, it's
interesting, isn't it?
I don't know if people see,like you said, there, black
Friday is the kickoff toChristmas spending, or if some
people it almost starts tocannibalise those sales.
So I'll take the supermarketsas an example.
You know, we've got club cardprices, we've got nectar prices,
we've got the Asda spending andsave points and they're all
(05:12):
discounting what you'd see asyour Christmas dinner.
So, yeah, other than Turkey'slambs, third off, half price,
pork, beef, et cetera.
So I don't know, savvy shoppersare going to have that and
stick it in the freezer, aren'tthey?
Speaker 2 (05:27):
Absolutely.
I mean I think there is adifference to possibly the food
and the non-food.
I think certainly people aretrying to stretch their budgets.
They have to because there'sonly so much money in that pot
for anyone, for any household,and they're going to look for
ways to have a great Christmasat the best price they can.
So if the offers are there nowthey will buy and put in the
freezer, bring them out, and ifthey have an opportunity to buy
(05:50):
gifts early, that's a reducedamount they will probably take
that up.
But you know that has alwaysbeen the case and there's always
been that fixed pot of spendingfor any household across
Christmas.
Yes, you may get a little bitof a sort of last minute
shopping when they see somebargains in the run up to
(06:12):
Christmas, but generally peopleare budgeting quite carefully
this year and last year becausepeople are stretched and they
have no choice and even at thehigher end we're seeing some
signs that the higher end orhigher end retailers are finally
starting to feel the impact aswell.
So I think I mean, brought BackFriday has always been that
(06:33):
opportunity for retailers tocapture that shop early and get
that spend in the bank, so tospeak, and not lose that shop to
other retailers.
Speaker 1 (06:43):
Yeah, it'd be
interesting to see how it plays
out.
I always think you can judgehow well Christmas has been for
many a retailer by how muchthey've got left for the January
sale.
Speaker 2 (06:53):
Yeah, absolutely,
although I feel that some
retailers have cut back oninventory and stock this year in
anticipating a tighter spendingChristmas, so it will be
interesting if they become moresavvy in terms of their stock
management.
They may not have much left toput in the sale which happened a
little bit over COVID, peoplerealized that people were
(07:15):
shopping, so retailers pulledback, so the sales weren't as
fantastic as people had hopedthey would be, but that pulls
people forward.
It makes people buy beforeChristmas rather than delay
spending until after Christmasto give people money, give kids
money, and then go and spendafter Christmas or wait until
very last minute.
(07:36):
I mean.
Interestingly, this yearperhaps this is more of a topic
for November, so I don'tunderstand why I'm in thunder,
but we have a full trading weekup to the end of the right after
Christmas, which is great newsfor retail, so that will be good
.
Speaker 1 (07:50):
Yeah, yeah, it'd be
interesting to see how it pans
out.
And how much does the weathertypically have an impact.
If it's kind of bright but cold, Does that make a difference,
or is it is the weather thesales on, dependent on the
weather?
Speaker 2 (08:02):
No weather is really
important for retail.
Rain is not retail's friend.
I mean, we all know personallythat we feel about going out
when it's pouring with rain.
I've had a look at the forecastfor Friday and it looks
actually relatively positive.
It looks reasonably mild anddry, which is great retail
(08:22):
weather.
It encourages people to be ableto go out.
People can get to where theywant to go with no hassle and
they can walk around highstreets and shopping centres at
ease, not feeling that they'vebeen blown off their feet.
So if the weather holds, thatwill be great news for Black
Friday.
Speaker 1 (08:39):
And then I assume
that kind of that correlation
carries on all the way throughto Christmas.
So if we end up with monsoonwinds, all that kind of stuff,
it discourages people or pushesthem into kind of more of the
regional destinations.
Speaker 2 (08:51):
Absolutely.
I mean, last Christmas was agreat example of that.
So the last week of theChristmas trading period we had
rail strikes, we had postalstrikes.
That really impacted Christmastrading last year because a lot
of people were leaving it reallyquite late because it was
incredibly cold as well.
I don't know if you remember,but it was like minus eight
degrees.
The weather was really hot, itwasn't very rainy, but it was
(09:14):
incredibly cold and the peoplewere leaving it late.
And then the rail strikes hitand so of course that pushed
people out of high streets,particularly because, even if
they wanted to, it was beendifficult to get to the city
centres but into shoppingcentres and retail parts, but
not fully, because some peoplejust abandoned trips.
But one thing that was quitepositive for retail destination
(09:37):
last year was the fact that thepostal service runs.
People relied less on onlinepurchasing.
They just didn't trust thedelivery mechanism to get those
gifts to them before Christmas,so they went back into retail
destinations.
So it was a bit of a give andtake, but those sorts of impacts
have a real effect on Christmastrading.
A large portion of people doleave it till quite late.
(09:59):
They may have a good look round, but there will always be
presents that they want to buylater, and if they can't get to
the source by then, that willimpact sales.
Speaker 1 (10:08):
Yeah, and there was a
report I can't remember if it
was BBC News or LinkedIn aroundthe top five delivery networks,
so I won't name them, but theones that will bring all your
parcels to your house.
None of them scored, I think,over 50% in terms of reliability
or customer satisfaction.
So again, there's some signsthat they're under pressure
(10:29):
already before we get to peak?
Speaker 2 (10:31):
Yeah, absolutely.
I mean, I don't think theycould have forecast or
anticipated the impact of thepostal strike, so they probably
didn't staff up well enough.
And there's only so muchcapacity Now.
They've only got so many vansand so many lawyers to carry
things around to people anddeliver things, and there's only
so many delivery slots they canhave.
So, you know, all this ispositive signs for retail
(10:56):
destinations and, of course,christmas is about pre-Christmas
this as well as the ChristmasDay bit and people want to soak
up that atmosphere and you can'treally do that online.
It's very functional, it's veryconvenient, it's very
transactional and some of theonline opportunities and
platforms are fantastic now andoffer a better experience, but
(11:18):
you're still sitting at home onyour own, essentially not having
that Christmas spirit aroundyou.
Speaker 1 (11:23):
Yep and Christmas
party season probably comes into
full swing for the most peopleearly next month through to
December.
So hopefully again a lift forhospitality and restaurant trade
.
Speaker 2 (11:35):
Absolutely, although
you know things have shifted
with.
You know, christmas partiesit's.
You know, in the days when wewere all in our offices five
days a week, we would, you know,christmas party was a given,
wasn't it?
And now everyone's more diverseand spread out geographically,
it's almost harder to organise aChristmas party.
Yet it becomes more importantto more of a date in the
(11:56):
calendar.
But I think some of it havebecome more relaxed and more
casual.
But certainly, you know, it's apeak point for hospitality and
it's a real opportunity forhospitality to, you know, pump
prime the revenue.
But they could have beenseverely lacking, particularly
over October with all the poorweather.
Speaker 1 (12:18):
Yeah, yeah.
And all the high streetfashions clearly geared towards
hoping people have parties,because if you stroll down the
high street and look in thewindows, they're all you know
selling you party dress or yournew shirt or your your spangly
jacket.
So they're all clearly hopingthat Christmas parties are in
full flow over the next coupleof months.
Speaker 2 (12:37):
Yes, absolutely, and
I think that's right.
I think you know there is adifference at Christmas and I
think many people will still gothe whole hulk and buy that new
outfit.
Things have become a littlemore, you know, cautious over
the last few years.
So the prices, the outfits thatpeople are willing to spend,
(12:58):
are probably lower than theywere a few years ago pre-covid.
And of course, many people havea lot of party outfits sitting
in their wardrobes pre-covidthat they haven't worn for three
or four years.
So there's probably a littlepullback in terms of that
evening wear market.
Perhaps we would have seen inyears if COVID hadn't happened.
Speaker 1 (13:18):
Excellent.
So next episode hopefully we'llhave some insight on Black
Friday.
That should give us a goodsteer into Christmas trade, and
then we'll see what happens atpeak.
Speaker 2 (13:29):
Yes, yeah, looking
forward to.
I'm always looking forward toBlack Friday to see what, what,
what the pattern of spending is.
Speaker 1 (13:36):
Yeah, excellent,
brilliant.
We'll pause there and we'llcatch up next month on Black
Friday and preview Christmas.
Speaker 2 (13:42):
Thanks, armin.
Speaker 1 (13:44):
Thank you.