Retail sales volumes (quantity bought) rose by 2.9% in May 2024, following a fall of 1.8% in April 2024 (revised from a fall of 2.3%), the latest ONS figures reveal.
Sales volumes rose across most sectors, with clothing retailers and furniture stores rebounding following poor weather in April.
More broadly, sales volumes rose by 1.0% in the three months to May 2024 when compared with the previous three months. However, they fell by 0.2% when compared with the three months to May 2023.
Deann Evans, managing director, EMEA, at global commerce platform, Shopify commented: “British retail sales rebounded in May, driven by consumers preparing and anticipating a warmer summer. Sales of garden items, warm weather-protective products and water sports equipment experienced sharp sales according to merchant figures from Shopify. After a slow start to the year, retailers can take comfort in retail sales recovering just in time for summer — a time when major sporting events, from the EUROs to the Olympics, will also likely improve the trading environment.
“Among the highest trending products were canoes (+592%), fly swatters (+414%), outdoor umbrellas (+399%), pool water slides (+230%) and sunloungers (+115%). We also saw a 70% rise in telescope sales, as May’s spectacular aurora borealis showing in the UK may have piqued people’s interest in astronomy-related products. However, to keep spending going, brands need to be conscious of how they engage with their audiences, with our data revealing more than four in five (82%) UK shoppers would become more loyal to brands if they were offered something — such as high-quality goods or service, promotions, and surprises.”
Matt Jeffers, retail strategy and consulting managing director for Accenture in the UK & Ireland, said: “Consumers have finally bucked the trend from the past few months and retailers will be relieved to see that they’ve returned to store despite the inclement weather. Despite a soggy start to the summer, sales in clothing retailers and furniture stores drove retail sales growth of 2.9%.
“There are signs that this growth could continue. Big events this summer, including the Euros and Taylor Swift’s Eras Tour, should provide a further boost for sales as consumers prioritise spending on experiences and events. Retailers will have also been planning how to capitalise on these moments with new marketing and value propositions which, coupled with a more settled weather forecast, may help to boost sales in the months ahead.”
Tom Youldon, partner at McKinsey & Company, responding to the news: “Retail sales have bounced back. With inflation down to the Bank’s 2% target, consumer confidence at the highest level since November 2021 and a 2.9% increase in retail sales volumes, consumer activity is picking up.
“In particular, online trading in apparel is finally recovering, with textile, clothing and footwear online sales rising 9.8%. Activity was likely boosted by the May bank holidays and some willingness from shoppers to splurge on discretionary goods. Although sales volumes overall still remain slightly below pre-COVID-19 levels.
“As we head into warmer months, retailers will be hopeful that falling inflation and rising wages will act as a further boost to GfK’s measure of consumer confidence. And that a combination of drier, sunnier weather, big sporting events like UEFA Euro 2024 and summer holiday purchases encourage greater spending at the tills.
“However, volatility could persist. Many shoppers are quickly swinging from saving to splurging. Retailers need to build a rich understanding of fast-changing preferences so they can deliver value through loyalty and pricing strategies – offering premium products where consumers are willing to treat themselves or tailoring product assortments in categories where shoppers are trading-down or switching brands.”
Silvia Rindone, EY UK&I retail lead, comments: “The numerous bank holidays in May provided retailers with a much-needed sales boost according to the latest figures from the ONS.
“Following a fall of 1.7% in April, retail sales volumes rose by 2.9% in May. Non-food store sales rose by 3.5% last month – the largest monthly rise since April 2021, with clothing and furniture stores rebounding following a period of poor weather. Online retailers also saw a rise of 5.4% in spending values.
“Although macroeconomic indicators, including interest rates, inflation, and wages are improving, it seems consumers are biding their time, waiting for a more optimistic climate before loosening their purse strings.
“As we move into the latter half of 2024, there is a sense that the tide may turn. A summer packed with high-profile sporting events such as UEFA Euro 2024 and the Paris Olympics, coupled with better weather and the possibility of political changes, could well be the catalyst for a resurgence in consumer confidence.
“While these upcoming events are beyond retailers’ control, they present a golden opportunity to drive sales. As the public mood brightens, savvy retailers should be ready to revisit their pricing and promotional strategies to fully leverage the wave of enthusiasm.”
Oliver Vernon-Harcourt, head of retail at Deloitte, said: “A double Bank Holiday in May boosted the retail sector, which saw its first retail sales volume growth since January. The tide could be finally turning for retailers, with more consumers releasing their purse strings and spending on discretionary items such as clothing and furniture. There are signs that certain recessionary behaviours are easing, as non-food store sales saw the largest volume rise since April 2021.
“The summer of sport has kicked off, and with warmer days upon us, the retail sector will be hoping to see spending momentum continue. Consumers are feeling more confident about their disposable income, but the next step for retail recovery will be seeing this translate into sustained levels of spending.”
