Page 7 - HGR April+May 2018
P. 7

NEWSLINE 5

Consumer confidence soars -lifts retail
spend in South Africa

        Mastercard                          that total monthly retail sales for the first  helped boost consumer spending.”
  SpendingPulse report                      quarter of 2018 grew by an average of 3.8
 shows total retail sales                   percent year-on-year, compared to the          Key findings of the Mastercard
                                            monthly average of 3.3 percent for the         SpendingPulse South Africa March 2018
    volume growing at                       fourth quarter of 2017.                        report include:
   quickest pace in five                                                                   • The general dealer sector showed tepid
                                              With the effects of inflation included,
            years                           retail sales for March 2018 grew seven           growth for a 17th consecutive month,
                                            percent year-on-year. The difference             with inflation-adjusted sales growing
Total South African retail sales for        between retail sales, with inflation             only 0.2 percent year-on-year in March
March 2018 grew by four percent year-       included and inflation excluded, was             2018. Including the effects of inflation,
on-year after removing the effects of       three percentage points, the lowest level        this sector showed sales growth of 6.7
inflation, marking the highest growth       since March 2013.                                percent year-on-year for the month.
rate for retail spending since May 2013.                                                     Though inflation is falling in this sector,
This is according to the Mastercard           “The shrinking gap between retail              its effect is more pronounced here than
SpendingPulse March 2018 report, which      sales, with inflation included and without       in other segments of the market.
provides a macroeconomic analysis of        inflation included, indicates we are
retail spending trends in South Africa.     starting to see real growth in the South          With the effects
                                            African economy and retail sector,” says          of inflation
  March’s retail performance rounds off a   Sarah Quinlan, Senior Vice President              included, retail
strong first quarter for the South African  and Group Head of Market Insights                 sales for March
retail market. SpendingPulse data shows     for Mastercard. “Lower inflation in key           2018 grew
                                            economic sectors, paired with rising              seven percent
3PAGE 4                                     business and consumer confidence, have            year-on-year...

the developing world. The use of video      powerful retail distribution channel,            “A stronger rand and a continued
is the fastest growing ad format and by     omnichannel strategies, and mar-tech           recovery from the drought in many parts
2020, video will make up 80% of all online  (Marketing technology based on digital         of the country helped to alleviate inflation
consumer internet traffic. Video can        transformation & optimisation). We             pressures. Food prices rose in line with the
improve click-through rates by 200-300%     are innovating faster and many new             consumer price index (CPI), after climbing
and increase purchase intent by 97%.        concepts will emerge in 2018 growing           faster than CPI for each of the past 28
                                            eComm revenues of $460+ billion.               months,” says Quinlan. “Shortly, we will
  TV shopping whether infomercial or                                                       begin to see how the one percentage point
live/recorded TV shopping is adapting,        Although TV Mall has only just               increase in VAT will impact consumer
evolving and innovating, not all at the     launched, home shopping will take off          spending and retail sales.”
same level of success, but everyone         and is the exciting future. South African
recognises that today it is necessary for   suppliers and retailers must take this
survival. And live video drives 300% more   into serious account or risk falling further
engagement than recorded video.             behind.

  eCommerce revenues were projected           In this era of depressed consumer
to reach $400 billion by the close          spend via conventional retail outlets,
of 2017. The next wave of social            TV Mall opens up a host of stunning
media which is a considerable and           opportunities. Carpe Diem, seize the
                                            day and absolutely inevitably sales will
                                            follow. The above article proves it.

                                            APRIL / MAY 2018 | HOME GOODS RETAILER
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