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Why retail giants struggled in December

By Victoria Dyke on Tue 21 January 2014 in Topical

Figures released just last week have unsurprisingly announced that December saw a record number of items bought online.

The big shock for many of us however, were the declining figures that some of the UKs biggest retailers in the UK. December’s online sales exceeded anyone’s expectations and the pace of the online retail revolution has shocked many leading retailers.

Tesco’s Phillip Clarke reported that he has been ‘taken aback by the change in consumer habits over Christmas’. eCommerce trends are even reaching the most unlikely of online shoppers.

‘Some 75 year old shoppers are doing their first transactions online via i-pads’ Sean McKee, head of eCommerce at Shuh

For some the surge in online shopping was great news . ASOS for example saw their sales jump more than 38% in the last 4 months of 2013! Next and John Lewis are a few other famous names whose figures boomed over the Christmas period.

And it is no surprise that they have attributed this success to their strong digital presence and well established online strategy. Next for example took advantage of consumers growing interest in delivery times and costs, offered free next day delivery during the Christmas period, and saw their sales rocket!

However, other well-known retailers are clear examples of how 2013’s online sales strength took over every other retail channel and how the unprepared are now being left behind. The most shocking perhaps being Marks and Spenser’s, who reported their first drop in sales for many years.

December also saw many in the food retail industry experienced a fall in sales. Food retail giant, Morrisions, suffered the most amongst the big 4 food retailers and cited the absence of an online offering being major factor for their 1% decline.

This is news that the industry is not ignoring. We are beginning to see a dramatic shift in food retail in preparation for the year ahead. Many are opening more ‘dark stores’ as online food shopping expands and the industry is reporting that the internet will be the key battleground in 2014 for grocers.

Online sales are set for success in 2014 with development continuing across many industries, but it is clear that just having a website or ecommerce store will no longer put you ahead of the competition. The likes of John Lewis, Next and House of Fraser have well-established online business strategies which are just as important, if not more important than their traditional models.

Mark Lewis, John Lewis’s online director believes, ‘ the biggest transformation will be the blurring together of all different shopping channels, online, mobile, home delivery and collection.’