Tablets and TV gangsters give shot in arm to retail sector over festive season
10pc sales hike gives businesses first truly Merry Christmas in five years. By Mark Keenan
AS we now know, the Irish retail sector finally got its first truly merry Christmas in five years – sources within the sector say the holiday season saw a hike of as much as 10pc on recent Christmases and follow on sales. Those who did worst were generally treading water on last year's results and at least experienced an arrest in successive declines.
"It might have been a small increase in sales overall, but the fact that Christmas trading has stopped falling at last is a huge psychological boost for retailers," says Retail Excellence Ireland's David FitzSimons. "It means they can begin to hire and invest once again."
Dermot O'Leary of Goodbody added: "Headwinds still remain for Irish consumer spending, but Ireland is no longer seeing the precipitous falls that it experienced over the previous four years and that is now being experienced in other peripheral economies."
But what about the products – the stuff on the shelves? Which lines sold well and which ones stayed on the shelves? Retail Excellence Ireland (REI), in touch with its member traders in all sectors in the last few days, has helped us compile the following guide to what was hot and what was not for Christmas 2012, the first truly festive one for retailers since 2007.
FESTIVE HOT CAKES:
1. Tablets Were Swallowed
Christmas 2012 was the season of the tablet – the one single item in most demand during the three-week shopping splurge. During the holiday, sales of flat computers rocketed by 1,000pc over last year's levels according to electronics and home wares chain Harvey Norman. Retail Excellence Ireland (REI) says many outlets sold out completely in the run up to Christmas. The sales saw less tablets sold, but buyers opting for better models – because they were buying for themselves.
"Tablet sales were absolutely staggering this year," says Blaine Callard, CEO of Harvey Norman in Ireland. "This year we sold more androids in the budget and mid price range (€150 to €300) than iPads. Last year Apple had 80pc of unit sales."
The big news was that Apple shot itself in the foot. The launch of the iPad mini which generated so much publicity months earlier floundered over the holiday because stocks of the product in the shops were minimal. "I think Apple likes to see queues around the block but this time they messed up badly," says REI's David FitzSimons.
2. Headphones blared
Premium headphones in "can" and "bud" styles which deliver music to an extremely high quality sound level are a relatively new consumer item and didn't feature at all two years ago. Both a fashion statement and a luxury, they doubled sales on last year with prices in the €300 and €400 range being paid. "2013 will see an increase in premium music equipment across the board as consumers try to match sound, the great picture on their HD televisions and downloaded music and movies," says Blaine Callard.
3. Men's Suits Pressed Ahead
Having flatlined from 2008 to 2011, menswear showed strong growth (about 9pc) with suits leading the way says REI. "When the recession kicked in, men, unlike women, simply stopped buying clothes altogether," says David FitzSimons. Looking into 2013, it seems the Irish male wants to enhance his chances of getting a new job. "We can presume to some extent that suits are a necessity which now must be replaced."
As for the traditional suit sales? Louis Copeland says sales since January 1 are up 10pc on last year. "People are at last replacing their shiny suits."
4. Glitzy decorations lit up
The "Americanisation" of outdoor Christmas decor continued with the increased purchase of ostentatious 'Homer Simpson' style outdoor lighting displays which spread to middle classes and even to D4. Christmas trees both artificial and natural experienced growth. Electric Christmas bling helped lift the garden and hardware sector unseasonally by 3pc says REI.
5. Boxed Sets Punched
Stiff Edwardians and loose Dublin gangsters saved the home entertainment sector from a complete drubbing this year. REI says television series boxed sets coined it at the tills with 'Downton Abbey' and RTE's 'Love/Hate' by far and away the biggest Irish sellers. REI believes shops would have sold even more had it not been for last minute queue issues in the entertainment outlets that saw flustered shoppers walking away from daunting lines. The TV boxed sets covered for plunging sales of individual movies whose offerings lacked "headline" draw, coupled with the continued drift to Sky Plus and Netflix.
6. "Totblets" Bounced
Toy, game and electric retailers experienced huge sales for toddler age "tablets" – like the Leap Pad 2 and Nabis – for those still in nappies alongside sales for games both online and of download card purchases in store.
"Parents are not only buying devices designed for toddlers but they're buying rubber cases for their own tablets and smart phones so children can use them without breaking them," says Blaine Callard. "Tablets are changing the way we live, they're fabulous educational devices for kids and they're going to be coming into our schools so parents want their kids using them. We have toddlers coming into our shops and running their finger up and down the front of flat screen televisions – that says it all really."
7. Food and Bed Warmed Up
Recession "nesting" came to the fore as "good" bed linen, quality beds and premium mattresses sold well while blenders, quality cooking devices and coffee makers sold strongly as Ireland "nested" instead of going out.
8. Pet Presents Leapt
Strangely, there was also a surge in sales of doggy coats, cat toys, and pet toys generally. "This is another American trend whereby families are doing "Santa" for the dog or the cat as well as the kids," said David FitzSimons.
THE CHRISTMAS TURKEYS:
1. Books Folded
Book sales fell off a cliff this year. "Our members' books sales were right down, probably in the order of 9pc on last Christmas" says David FitzSimons of REI. In its end of year trading report for 2012 the organisation stated: "Books have struggled and are not viewed as relevant a Christmas gift as they once were."
Not helping was the distinct lack of "headline" books to stand out on the shelves along with the hefty prices of meaty hardbacks in stock.
Mr FitzSimons adds: "People continued to change their reading habits and drifting more to online material and of course the continued growth in sales of e-readers and downloadable books underlines this."
1. Telly Was A Turn-off
Following the big switch to digital in the autumn, buyers brought forward their planned purchases of televisions with the result that sales hiked by 25pc in October but correspondingly there was a bigger switch off in interest for Christmas and the sales were down 30pc.
2. Laptops Crashed
Directly linked to the rise of the tablet this year was the fall in laptop sales – down 15pc across the Irish electronics sector estimates Harvey Norman. "The big question for 2013 is whether or not people will continue buying both tablets and laptops in large numbers," added one leading electronics retailer.
3. Toys Broke
There were few "headline" toys available over Christmas to capture young imaginations as the big toy retailers misguidedly attempted to revive old reliable crazes from the past such as Furbies and Cabbage Patch kids. Instead Irish kids were demanding tablets, phones and computer games from Santa who would be carrying a smaller, but more valuable sack of goodies down the average Irish chimney.
4. Dresses Slipped
A determination among Irish women to cut back on their fashion budgets combined with a distinct lack of Christmas parties to go to in the corporate holiday season slashed the numbers of little black dresses leaving the shops. Women's fashion retail was down overall by around 4pc on last year says REI. "It didn't help that the weather was mild in the run up to Christmas and there was no particular need for new coats and jackets either," says David Fitzsimons.
5. Music Discs Faded
"Music disc sales hit single digit decline as buyers continued to download their music online and there was a fail in the management of "headline" music discs coming to market," says REI.
6. Cameras Were Underexposed
The hugely improved quality of smartphone cameras combined with an ebb in planned foreign holidays among consumers caused digital camera sales to misfire badly on last year. Harvey Norman estimates a slump in sales in the order of 15pc on last year.
7. Cars Were Stranded
While December has always been the worst month for new car sales, the addition of new format 131 plates this year on top of the ongoing perfect storm for the motor industry means last month's will likely be among the worst on record for any December. The days when a spouse or adult son or daughter woke on Christmas morning to a flashy new runabout with a big red bow tied over it are with the ghosts of Christmas long past.
Treading Water: Groceries, shoes, jewellery, phones, games, consoles, pharmacy, perfumes.