Report Summary

Period covered: 24 November – 28 December 2024

3 minute read

Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.

Health & Beauty - Retail Economics Index

Health & Beauty sales rose by xx% YoY in December, compared to xx% growth in December 2023, according to the Retail Economics Retail Sales Index (value, non-seasonally adjusted).

The Health & Beauty sector saw the largest growth across the retail sector as consumers flocked to the category for seasonal purchases.

Sales drivers

Several key factors influenced this performance:

• Black Friday timing: The timing of the main Black Friday weekend fell in the December trading period, which it didn’t in 2023, giving a boost to December sales.
• Seasonal purchases: Growth in the category was driven by gifting, seasonal illnesses, and promotions. Promotions were particularly important this year with consumers concentrating spending around promotional events and holding out for the best deals. 
• Consumer confidence rises: The GfK consumer confidence index rose one point to -xx in December, a modest but positive change.
• Stormy weather: The UK saw strong winds, heavy rain and stormy weather throughout the month, with many affected by flooding and power cuts. 
• Omnichannel outperforms: Online shopping surged xx% as consumers stayed home to avoid the weather, with trust in delivery and click and collect services growth. Footfall grew xx% YoY, led by retail parks. Retailers who have invested in omnichannel operations excelled as a result.

Outlook  

Headline inflation saw an unexpected fall in December to xx% as restaurant and hotel prices eased, and as clothing and footwear inflation fell.

As a result, financial markets have increased expectations of an interest rate cut by the Bank of England in February, and of further cuts this year. Markets now assign a xx% probability of an interest rate cut in February, up from xx%. Wage growth is expected to outpace inflation this year, offering further relief for households.

However, inflation remains above target, retailers face uncertain headwinds, and recent GDP growth has been shaky, meaning the road to recovery following the cost-of-living crisis will be an uneven one.

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Consumer confidence edged up in December