Key trends from the ONS Retail Sales February Report

ONS Retail Sales February Findings

The ONS Retail Sales February findings have highlighted a number of key findings:

• Retail sales volumes are estimated to have increased by 1.2% in February 2023, following a rise of 0.9% in January 2023. In comparison to the same month a year earlier, sales volumes fell by 3.5%
• Looking at the broader picture, sales volumes fell by 0.3% in the three months to February 2023, when compared with the previous three months
• Non-food stores sales volumes rose by 2.4% over the month because of strong sales in discount department stores
• Non-store retailing (predominantly online retailers) sales volumes rose by 0.2% in February 2023, following a rise of 2.9% in January 2023

Key trends from the ONS Retail Sales February

We spoke to experts and asked for their opinions on the findings from the ONS Retail Sales February. Here’s what they had to say:

Key trend: building trust

Andy Cockburn, CEO and Founder of Mention Me, explained:

“Retail experienced a major result last month as sales in February returned to pre-pandemic levels, according to the latest set of figures from The Office for National Statistics (ONS). Despite the economic downturn, consumer confidence is on the rise, which is an encouraging sign for an industry that has had its fair share of disruption in recent years.

“What we are seeing in our data is an increased reliance on a key commodity: trust. It’s no surprise that recommendations from friends, family and colleagues are helping fuel retail’s revival. These internal champions are helping drive sales at a time when brands find traditional ways of reaching potential buyers blocked. We’ve seen the demise of third-party cookies and other marketing staples, for example, leading to a rethink of how to boost sales.

“The brands that build trust with consumers now will form stronger relationships with their current and future customers, creating a sustainable growth strategy that lasts long beyond the economic downturn.”

Key trend: offering value

Steve Ponting, Director, Software AG UK&I, added:

“As we’ve seen previously, inflation and high prices don’t always translate to a drop in spending. February saw an 1.2% increase in retail sales. However, what we are actually seeing is consumers getting less bang for their buck, as a 40-year high inflation masks increased sales with higher prices.

“As the cost-of-living bites into disposable incomes, consumers continue to search for the best price and, although familiarity with a brand can help, recognition doesn’t set retailers apart anymore. Price is just one piece of the puzzle, but all retailers must provide value, service, and trust if they want to set themselves apart. When times are tough, those players that aren’t resilient or agile, get separated from those who are, and customers notice.”

Key trend: remaining agile

Silvia Rindone, EY UK&I Retail Lead, commented:

“Retail sales improved for the second consecutive month in February, with volumes estimated to have increased by 1.2%.

“This is a welcome positive improvement, that shows some cautionary confidence from consumers. However, the 1.6% month-on-month increase in value terms is largely due to inflation. Looking ahead, growth within the retail sector is likely to be minimal. “While the retail sector continues to face a number of challenges, brands and retailers which are managing to adapt may see opportunities to acquire both customers and market share.”

Summary of the ONS Retail Sales February Figures

While we are beginning to see figures return to levels more similar to before the pandemic, there is a lot of change happening. Retailers that are able to identify consumers’ priorities and deliver an experience in line with these will put themselves in the best position to gain loyal customers.