Retailwatch: October 2010

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Overall retail spend is still fairly flat this month, compared to both September 2010 and October 2009. A 4.1% year on year rise can be partly attributed to the GST increase that took effect in October 2010.

Also happening in October were the government tax cuts, intended to offset GST rises. However, this report reflects no big jump in spend as we all took home some extra income. It could be that people are saving more or channelling their surplus into paying off debts, consolidating their positions after the scare of a global financial crisis. Additionally, people who are paid monthly didn’t see any extra income for much of October.

While most categories show positive growth this month, the category with the biggest decrease compared to October 2009 is Furniture/Appliances/Electronics, which went down 10.3% An even bigger decrease was seen in October compared to September 2010, with spend in the category down 20.8% This appears to be a result of the GST increase; September spend levels were higher than usual. Spend across the quarter in this category was level with the previous quarter indicating that the same overall amount was being bought, there was just a scramble by consumers prior to 1 October.

The categories to see the biggest positive growth this month have been Fuel/Service Stations and Recreation & Entertainment. As far as the Fuel/Service Stations category goes, a lot of the year on year difference can be put down to price rises. Petrol prices have increased by 10.8% in the last year, so a rise of 9.9% in spend is expected.

In terms of Recreation & Entertainment, the year on year increase of 9.0% for this category signals a positive tilt on consumer confidence. This category normally represents discretionary spend, and will have been encouraged during October by a surge in ticket releases for touring artists and an abundance of sporting events.

The Home & Building Supplies category, which we have seen claw its way back from huge declines last year, has seen a year on year increase in October of 3.9% However, compared to September 2010, spend in the category is up 11.6%; a seasonal trend which we also saw evidence of last year as we moved closer to Summer.

Retailwatch can be used to monitor trends in specific categories that are relevant to you while also building a broader picture of the overall retail environment.

The team at Datamine can also help you explore further the impacts of retail industry trends on your business. If you have any questions or would like further information that would help support your business decision making needs, please don’t hesitate to call us.

Datamine offers a range of retail tools, including merchant specific market share reporting, catalogue optimisation, media return on investment, campaign analysis, customer profiling, churn and cross sell models, data cleaning and management and consulting.