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Diverging Fortunes For U.S. And UK Retail This Christmas

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Early data indicate that retailers in the U.S. and UK had very different holiday periods, with things looking up stateside but remaining gloomy in Great Britain.

Holiday sales in the U.S., covering the period from 1 November to Christmas Eve, rose 5.1% compared to the same period last year, the strongest growth in six years, according to MasterCard SpendingPulse. Online saw the strongest growth at 19%, but physical retail sales also increased for all types of stores except for department stores, which declined 1.3%.

Home improvement sales and clothing sales were the strongest performers, at 9% and 8% improvement, respectively, with the latter figure being the strongest growth since 2010. Furniture sales were up 2% and electronics sales were down 1%.

It is not quite comparing apples with apples, but recent physical retail sales data from the UK paints a less positive picture.

Boxing Day is traditionally one of the biggest days of the year for retail spending in the UK, but visitors to shopping centres, high streets and retail parks dropped 3.1% compared to 2017, according to data from Springboard. Sales were up in London and Scotland but down everywhere else. Overall the drop was smaller than in the previous two years.

Boxing Day used to mark the start of the post-Christmas sales period, but Springboard pointed out that most retailers had started sales well before Christmas to lure in buyers, reducing the appeal of Boxing Day shopping. Retailers were having to cut prices even further to attract shoppers, eating into margins.

“Boxing Day has become less important as a trading day,” Springboard Insights Director Diane Wehrle said. “You don’t get that massive surge, particularly as we’ve had virtually continuous discounting since Black Friday. Online sales are still growing, but growth is less this year than last year.”

One online giant continued to rake in holiday sales.

It was a record-breaking holiday season for Amazon, with more items ordered worldwide that ever before, the e-commerce giant reported Wednesday. The company also said more than 50% of the items sold in Amazon's online stores came from small and medium-sized businesses this holiday season. In the U.S., more than 1 billion items shipped for free for the holidays using Amazon Prime memberships.