By Maximilian Clarke
The UK’s consumer confidence remains rock bottom. climbing just one point in October, the figure, at -31 remains 10 points lower than for the same month 2010, GfK's latest figures show.
Income growth remains muted in the private sector; whilst pay freezes remain in effect for millions of the UK’s public sector workers. Meanwhile, the eurozone debt crisis that continues to rock the FTSE and other global marketplaces continues to grow from the peripheries to the core of the bloc, undermining business confidence across the continent.
On this backdrop, it is perhaps unsurprising that consumer confidence remains low. This confidence has translated to the retail sector, which is currently entering an employment recession- with retail sales growing just 1.6% over the past 12 months, far below the 5% retail prices inflation.
“The figures indicate that consumer confidence continues to have a significant impact at the tills and the news of rocketing inflation won’t do much to encourage shoppers to recommence their spending,” commented Kevin Flood, CEO of social commerce site, Shopow. “One positive however is that many British consumers feel that now is the time to make a big ticket purchase, a notion which will receive the warmest of welcomes on the high street.
“The pressure is on the retailers in the approach to Christmas as many are finding that more aggressive discounting is necessary to prevent what could be a difficult season. Although the high street is severely being tested, we are expecting an encouraging next couple of months online with many stores embracing a multi-channel approach across mobile, online and in-store.
“With purse strings tightened, shoppers are using social networking to share the deals and discounts they have discovered. The retailers who make social shopping accessible will benefit from natural, word of mouth exposure.”
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