Online to overtake store spending for the first time this Christmas - report

By

Sandra Halliday

Published
Oct 28, 2020

Online sales are set to overtake physical retail for the first time this Christmas season, according to a new prediction from delivery specialist ParcelHero. The company said Britons should spend £39.41 billion online this Christmas.

Online sales have been rising for years and especially at Christmas as consumers have sought greater convenience than venturing out into shops during the past decade. But the pandemic has speeded up the trend. And while many consumers will be unwilling to venture into stores because of the fear of infection or due to restrictions on their movements this year, some of the accelerated online habits they've adopted will likely turn into long-term behaviour.

ParcelHero said Britain’s shoppers spent over £78 billion on Christmas presents and food last year and spending is likely to be similar for Christmas 2020, although there will be a notable shift in the channels consumers are using. 

Head of Consumer Research David Jinks said: “Last Christmas, we spent £25.43 billion online and £53.15 billion in stores. This year, our research shows the situation will be reversed and we’ll spend more online than offline in the first truly digital Christmas.”

In September, sales online sales grew 53% year-on-year, according to the Office for National Statistics (ONS). “This Christmas, we think they will inch up to 55%. That means online shopping will rise to a record-breaking £39.41 billion,”’ Jinks added.

“We don’t think it’s likely we’ll see a massively increased overall spend this Christmas, as people are concerned for their jobs because of the impact of Covid and Brexit, which looms just seven days after Christmas. So, assuming Britons spend roughly the same as last year, that means in-store shopping will correspondingly drop considerably to £39.17 billion.”

YouGov has said that English shoppers spent £381 on presents last Christmas and £159 on food and drink. Over half of this budget will be spent online this year, ParcelHero predicts. 

“We’ve already seen proof we’ll be buying many more presents online in 2020. Online department store sales rose 88% in September as people pre-ordered new PlayStation 5s and Xbox Series X consoles in time for Christmas delivery,” Jinks said.