2017 has been the year of the discount - with 56 per cent of all high street fashion being discounted compared to only 35 per cent for the same period in 2016. But, with Black Friday upon us, research from retail analytics business Mallzee Insights suggests that this discounting trend could be ending - the first three weeks of November have been the first time this year where the volume of products ‘on sale’ is less than in 2016, dropping from 51 per cent to 37 per cent in 2017.
Mallzee Insights have today released figures indicating that the discounting spiral may well be over - based on data from the 100,000+ fashion items featured in the marketplace app, from 150+ high street retailers.
Since late 2016 there has been much comment on the state of the UK fashion industry and the pressures facing retailers, illustrated by some very high profile big name collapses. Retailers are dealing with, what has been dubbed, a Perfect Storm with all three cost variables increasing (product, staffing and store costs) whilst at the same time facing a reduction in consumer confidence and thus spending due to political and economic uncertainty.
Retailers have been responding to cashflow challenges throughout 2017 by cutting prices on more products than in 2016 but as illustrated by the graphs below, the amount of discount on products has generally been lower than in 2016. Since the start of November these two
discounting trends have reversed and whist the volume of products discounted, to date this month, have dropped the volume of discount has risen, from 36 per cent in November 2016 to 41 per cent.
Cally Russell, Mallzee founder and CEO, reflects: “Could it be that retailers are calling time on the discounting spiral? It’s still too early to predict but these figures could indicate that retailers are looking to other cost tightening solutions and aligning their products more closely with what consumers are actually prepared to buy thus maximising their full price sell through.
Mallzee was launched in Edinburgh in late 2012 and brings together 150+ retailers to allow users to find, compare and buy in one handy free app. Mallzee has been downloaded over 1.25 million times and users swipe millions of product interactions daily.
