This weekend I briefly took leave of my senses and ventured onto Oxford Street on the way to see Peter Jackson’s excellent if slightly overlong prequel (part one) to Lord of the Rings.
For those of you who haven’t yet seen the Hobbit there’s a scene where the main protagonists spend a good deal of time running away from a murderous goblin horde.
After a couple of minutes of Oxford Street I could quite relate to the plight of Bilbo Baggins and company.
Judging by the weight of human traffic, and the cautious optimism that seems to be spreading through the market in the UK, it seems as though retailers are going through a relatively decent Christmas period given the financial climate.
The retail research group Verdict are predicting a 1% rise in Christmas spending this year, the highest year on year increase since the start of the economic crisis.
Nevertheless, the year-on-year slip in consumer spend in October by 0.1% does suggest that the recovery is fragile, and that retailers are going to have a job on their hands to sustain any positive growth heading into the new year.
The answer for many, and particularly for those such as the precariously positioned HMV, is going to be finding ways to retain custom that comes their way during the financial period.
Given the price sensitivity of customers we’re headed for a fascinating period on Boxing Day and into the January sales. But pricing competitively is only a short term solution, a sticking plaster covering up a lack of long standing customer loyalty.
Instead, retailers need to be working doubly hard to capture and analyse critical customer data in order to create personalised offerings, even after the en-masse deals finish. It will be interesting to see which retailers push reward schemes, credit cards and membership groups on top of the 20% off all items deals that will be the norm.
More than ever, this Christmas will make or break many high street retailers. It’s going to be quite a fight.
If you come across interesting examples of retailers working to retain Christmas commerce please do share in the comments bar below.
For my views on how the Millennial Generation approach customer loyalty follow this link.