High Street Faces Boxing Day Decline as Shoppers Turn to Online Sales

Boxing Day, once a key date for post-Christmas shopping, has seen a noticeable decline in footfall across UK high streets and shopping centres this year. According to recent data from MRI Software, footfall on UK high streets was down by 9.6% in 2023 compared to the previous year, while shopping centres experienced a 5.1% decrease in visitors by 8 p.m. GMT. These numbers suggest that the traditional Boxing Day shopping rush is becoming less of a retail event, with many consumers preferring to shop from the comfort of their homes instead.

The Rise of Online Shopping

This year’s Boxing Day sales figures point to the continuing dominance of online shopping. Many shoppers are choosing the convenience of online deals over in-store visits, a trend that has been ongoing for several years. Despite major retailers like John Lewis, Marks & Spencer, and Next opting to keep most of their stores closed to allow staff some holiday rest, shoppers are still expected to spend significant amounts, though mostly through online platforms.

Jenni Matthews from MRI Software highlighted that this shift reflects the broader change in consumer behavior, especially influenced by the ongoing cost-of-living crisis. Consumers are now more conscious of where they spend, with many opting for the lower overhead costs of online retailers, which don't have the same energy expenses and staffing costs as brick-and-mortar stores.

The Impact of the Cost-of-Living Crisis on Retail

Data so far suggests that in-store visits are 20.5% lower than pre-pandemic levels. Analysts attribute this decline in part to the financial pressures many shoppers are facing. Rising energy costs, coupled with the need for overtime pay for retail staff working on a public holiday, are making physical stores more expensive to operate. On the other hand, online stores, which often offer discounts and promotions, are much more cost-effective for both retailers and consumers.

Sales in clothing stores have already reached their lowest point since January 2022, according to the Office for National Statistics, further indicating that economic pressures are affecting retail spending.

UK Retail Parks Show Slightly Better Performance

While high streets and shopping centres have seen significant drops in footfall, UK retail parks have fared slightly better, with only a 6.1% fall in visitors compared to last year. Retail parks, which often offer free parking and larger stores, are proving to be more appealing to shoppers, especially for those purchasing big-ticket items or looking for a wider range of goods.

Changing Consumer Habits: Promotion Fatigue and Shift to Experience-Based Spending

One of the main reasons for the decline in Boxing Day shopping is what experts are calling "promotion fatigue." Natalie Berg, an analyst at NBK Retail, explained that with promotional deals starting as early as Halloween, consumers are feeling overwhelmed by the constant stream of discounts and offers. As a result, many are less likely to be excited about Boxing Day sales, and the event no longer holds the same allure it once did.

Diane Wehrle from Rendle Intelligence and Insights further pointed out that for those who do choose to visit retail locations, the focus has shifted from buying products to seeking experiences. Consumers are increasingly spending on leisure activities or entertainment rather than traditional retail purchases.

The Future of Boxing Day Sales

Despite the decline in foot traffic, Barclays forecasts that Brits will spend a total of £4.6bn on Boxing Day 2024, slightly less than the £4.7bn spent in 2023. As expected, the majority of this spending will occur online, with 63.9% of all Boxing Day retail purchases being made through online channels last year.

This ongoing trend of online dominance raises questions about the future of physical retail spaces, particularly during key shopping events like Boxing Day. As retailers adapt to changing consumer behavior, it's clear that the rise of online shopping and the growing preference for promotions earlier in the season are reshaping how the British public approaches post-Christmas sales.