Retail saw a stores renaissance in 2023, as many shoppers returned to bricks and mortar following a surge in online shopping during the pandemic.

Retailers such as Sephora, Abbott Lyon and Oysho set up shop in the UK last year, all debuting their branches in the prominent shopping destination, Westfield London.

Others came back to the world of physical retail, with HMV returning to its iconic Oxford Street store after a four-year absence, while Wilko is rolling out new concept stores under The Range’s ownership, following its demise last summer. 

By comparison, 2023 was a mixed bag for online retailers, as pureplay fashion retailers Asos and Boohoo faced a turbulent year with declining sales.

Amazon continued to dominate ecommerce and saw a record-breaking Black Friday and Cyber Monday shopping event.

But how did these channels perform over Christmas? Did online retailers receive a boost in sales and traffic? Or did in-store shopping reign supreme? 

Festive footfall

Christmas trading results from retailers are still flooding in and the overall picture shows that despite previous warnings, consumers still shopped over Christmas.

Marks & Spencer saw its food sales increase 10.5%, while clothing and home grew 2% in-store and 10.9% online.

Kantar data shows 488 million trips were made to the supermarket over the four weeks to December 24, and this was reflected in Tesco, Sainsbury’s, Aldi and Lidl’s results as each grocer reported sales increases in the run-up to Christmas.

Luxury department store Fortnum & Mason posted a 17% rise in sales in the five weeks to Christmas Eve, driven by “record” numbers of customers shopping online and in-store.

Turbine Hall Battersea Power Station Christmas 2023

Source: Charlie Round-Turner

There was an 11% rise in footfall at shopping centres such as Battersea Power Station in December 2023

While the usual suspects of grocers and department stores performed well at Christmas, there was a leap in footfall at shopping centres, as MRI Software data shows an 11.1% rise in December.

“This is down to the choice that’s available under one roof, as you’ve got a whole host of brands,” says MRI Software insights director Jenni Matthews.

“There are retail, leisure and hospitality options, and in some cases, you have free parking which makes it a very convenient choice for festive shopping trips.”

Both Battersea Power Station and Outlet Shopping at The O2 recorded a leap in like-for-like sales, with the latter seeing a new record trading day on Boxing Day, with sales up 33% on the same day in 2022.

Landsec, which owns shopping centres such as Bluewater in Kent and Trinity in Leeds, also saw a “marked increase” in visitors throughout the festive period.

“The week before Christmas is always one of the busiest for retail and this year we outperformed expectations, with more than half a million extra visits to our retail destinations compared to last year and footfall soaring by 23% across our outlets,” says Nik Porter, head of retail brand account management at Landsec.

Post-Christmas Day told a different tale, as MRI data shows high streets saw a rise in footfall while shopping centre and retail park footfall dropped week on week.

“High streets saw a rise and on Boxing Day itself, footfall was 8.8% higher year on year on the high street,” says Matthews

“From the trading reports that have been published in recent weeks, it appears both online and offline channels have passed previous expectations.”

Online on the rise

While many shoppers flocked to shopping centres, supermarkets and department stores, others turned to online channels for their festive spending.

Data from Adobe shows a total of £11.2bn was spent online in December, up 1.5% year on year, with Boxing Day online spend reaching £461.8m.

The Very Group posted a 3.4% rise in UK sales in the seven weeks to December 22, crediting sales in toys, gifting beauty and electricals for strong trading.

Ocado saw its highest-ever sales level over the Christmas period, with a 7% increase in sales as it sold over “90% of peak Christmas slots” between December 22 and December 24.

Despite many retailers recording rising sales, data from the BRC shows growth in retail sales slowed in December compared to last year.

Food sales grew 6.8% but were still lower than the 12-month average. In-store non-food sales fell 1.3% and online non-food sales slipped 0.8%.

Christmas-shopping-on-phone

Shoppers were more comfortable with last-minute online shopping in 2023 compared to 2022

BRC director of insight Kris Harmer says: “We saw non-food decline over December; however, the decline in-store was larger than the decline online, suggesting that online weathered the storm better.

“This is mainly due to a significant rise in online sales the week before Christmas, while in-store sales remained down on the previous year.

“This suggests there was more last-minute online shopping. It is worth remembering that 2022 had Christmas postal strikes, so this year was more reliable and people were more comfortable ordering at the last minute.”

Similarweb’s data of the most-visited retail websites in the UK over Christmas supports Harmer’s argument, as Amazon logged 80.1 million visits to its website one week before Christmas followed by eBay and Etsy with 47.2 million and 12.8 million visits respectively.

Despite bricks and mortar seeing a comeback in 2023, online retail can’t be written off as it remains popular for last-minute shopping, as well as a go-to for when bad weather and train strikes halt shopping trips.

With Tesco boss Ken Murphy predicting more “balanced” consumer confidence this year, we could see a sharp rise in both in-store and online Christmas sales in 2024.