December’s Christmas trading results give insight into how different sectors are performing in the current economic climate. Some key takeaways include an ongoing emphasis towards omnichannel retailing, consumers trading up where possible, and an increase in socialisation which aided F&B operators across the golden quarter. However, these themes are limited to the retailers who chose to publish results.

1. Grocery was a standout performer

Once again, the grocery sector saw strong sales growth overall across the festive period, with those that published reports averaging a 5.1% increase in sales (YoY). In fact, several grocers such as Lidl, Aldi, Ocado and Booths reported that 2024 marked their best-ever Christmas trading period. Asda is the only major supermarket in the UK to report negative sales growth across the golden quarter so far, which has led to a decline in market share from 13.5% to 12.5%. It was Ocado, however, that enjoyed the biggest sales boost of any grocery retailer (9.6% YoY), a growth that was aided by its partnership with M&S. The results also highlighted a number of consumer trends over the period, including an increase in sparkling wine and champagne sales, a focus on party food ranges, and trading up to grocer’s premium food ranges.

2. Consumers traded up where possible

With the gap between retail values and volumes narrowing, coupled with increases to consumer confidence, consumers found themselves with slightly more discretionary spend over Christmas compared to recent years. This caused spending habits to adapt, as middle-affluence consumers who alter between trading up or down depending on the macroeconomic climate were able to trade up this year. Value operators (excluding grocers) generally saw a like-for-like sales decline, including Primark, Poundland and B&M; however, they were up against strong comparatives from the previous year. In contrast, operators stocking higher quality ranges succeeded, such as the 12% growth in Aldi’s Specially Selected range, the 16% growth in Sainsbury’s Taste the Difference range, in addition to the general growth reported by more aspirational retailers, including Hotel Chocolat, White Stuff, Seasalt, Ocado and Booths.

3. Online and Click & Collect thrived

Online sales were up during the festive period, as many consumers decided to shop from the comfort of their homes as opposed to facing stormy weather in November and December. Total UK footfall was down -2.5% in the golden quarter opposed to 2023, which impacted in-store sales, with Next and Marks and Spencer reporting negative in-store sales growth. The halo effect was, however, in play, as operators with an omnichannel presence were able to attract consumers to stores through Click & Collect, with M&S reporting an increase in these orders by 20%. Retailers from an array of sectors similarly reported strong online growth, including Tesco, Next, ProCook, Superdrug, Dunelm and The Very Group.

4. F&B saw heightened demand due to increased socialisation

The F&B market thrived this Christmas and was once again aided in the final quarter by increased socialisation due to Christmas parties, bank holidays, and consumers having time off work. The sector saw an average sales growth of 8.4% compared to the previous Christmas. This aligns with performance reported by F&B operators, including Marston’s, which reported total YoY sales growth of 3% across the 16 weeks to 18th January, and Young’s, which saw like-for-like sales up 11.6% in the five weeks to 13th January. The strong performance of pubs reflects the ongoing trend of consumers favouring more casual dining options over more formal restaurant meals.

5. Health and beauty continued to perform well

Following the momentum the sector has seen throughout the year, health & beauty spend continued to grow over Christmas. Based on the retailers who published results, the sector’s average sales increased by 2.9% YoY over the Christmas period. Barclaycard spend data similarly evidences that health & beauty spend grew by 7% across the final quarter – the largest quarterly growth of any physical goods spend category as consumers continue to prioritise health, wellbeing and cosmetic-related spend. This was further illustrated by retailers such as Superdrug, which reported its best Christmas ever, driven by its own brand ranges, healthcare and fragrance. Black Friday week was also positive for the sector, with retailers such as Boots reporting a 20% rise in sales in the period, with beauty, fragrance and gifting also among the top-selling categories.

Whilst many retailers have reported positive sales growth over the festive period, most retail and leisure operators remain cautious as we continue into 2025 due to the upcoming changes associated with the Budget from April.

_{Back to top of page}