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Q2 2017 saw plenty of political drama unfold on the global stage, but the retail industry again proved its resilience.
Against a backdrop of growing consumer confidence and market expansion, retailers across the world overcame uncertainty, and many countries saw more shoppers visiting stores during the quarter than they did during the same period last year. Meanwhile, the prospects for the future are generally brighter than anticipated.
So, what market trends were at the heart of consumer traffic developments across Europe and APAC between April and June this year? Here are some findings from our latest Europe Shopper Trends and APAC Shopper Trends reports:
In Europe, Year-on-Year shopper traffic proved resilient at -0.1%. The Financial Times reported that consumer confidence in the Eurozone hit a decade-high in May, reaching levels of optimism not seen since before the financial crisis.
Looking at Europe on a country-by-country basis reveals a mixed picture, but there is widespread positivity, and much of this can be attributed to the shifting political line-up.
It’s no secret that politics influences in-store traffic – whether its knock-on effects are immediate, or become evident over time, consumers are always keen to hear how the latest political decisions might affect their personal finances – in turn, making them less or more likely to spend.
Q2 2017 saw several populist parties defeated by middle-ground representatives, paving the way for greater stability and financial security. In France, although shopper footfall was down by a marginal -1.9% Year-on-Year, the election of pro-EU centrist Emmanuel Macron revived the country’s economic growth forecasts. The markets breathed a sigh of relief that it was Macron’s mandate for reform, and not his rival’s threat to withdraw from the euro, that won the day.
Meanwhile, in the Republic of Ireland, shopper traffic grew by +1.9% Year-on-Year in Q2, as the pro-EU Leo Varadkar was elected to power, who stated his intent to accelerate the nation’s economic recovery while mitigating any fallout from Brexit.
With Germany, which saw shopper traffic grow by +1.7%, now anticipating a victory for Angela Merkel in September, many of Europe’s retailers can look forward to a favourable consumer climate in the months to come.
During the same quarter, Austria, Poland and Portugal also saw shopper footfall rise, compared to the same period in 2016. This growth was prompted by the revival of neighbouring economies, growing consumer confidence and falling unemployment.
The outlook is bright across APAC, too – the region saw overall Year-on-Year shopper footfall growth of +0.5% during the second quarter of the year.
This performance can be attributed to a number of factors, but there is a recurring theme: big-name retailers, such as Walmart and Amazon in India, and TK Maxx and Kaufland in Australia, are seizing the opportunity to extend their reach in these regions. Shoppers in both developing and mature markets are now welcoming these big-box brands overseas with open arms.
India’s shopper footfall grew by an impressive +7.6% Year-on-Year during Q2, and the country’s continued growth has not gone unnoticed by foreign investors.
India has become the fastest-growing retail market in the world, driven in part by the emerging urban, educated consumer class. Lured by softening legislation, retailers including Walmart and Amazon have been quick to claim a share of India’s bricks-and-mortar retail potential by establishing a sizeable store footprint across the country.
Hong Kong and Japan also saw shopper traffic growth during the quarter, while China reported a surge in import and export activity in May, despite recording a Year-on-Year decrease in shopper traffic of -5%.
With shopper behaviour shifting continuously in line with external pressures, such as political change, it is essential that retailers can access detailed information about how and where consumers are spending their money, so they can make strategic decisions based on this knowledge.
ShopperTrak offers valuable insight into how consumers are behaving, providing retailers with the knowledge and tools they need to meet demand.
Contact us for more insights into consumer traffic performance during Q2 2017.
Sensormatic News Desk