The anticipated softening of sales growth in 2008 won't automatically be driven by fewer shopping expeditions. People�s motivations to shop and to buy are very different. However, I expect footfall entering shops to be lower than 2007, by as much as 3%, influenced by key economic and social changes:
* More opportunity for non-food shopping at grocery stores will continue to influence footfall into specialists.
* The growing strain on consumer's budgets will increase people's desire for lower prices, particularly on goods other than everyday consumables. More price-checking on the internet before venturing out to inspect/buy. Paradoxically, more of us will turn towards old-fashioned legwork for reconnaissance purposes, which will actually stimulate footfall.
* More diversity in store traffic levels between retailers and across sectors, as consumers' choice and favour become polarised. Both value chains and luxury stores will punch above their weight, but the specialist middle-market might suffer.
* The sectors set to see the steepest decline in footfall are those associated with housing. Price realignment combined with a reduction in mortgage offers will depress house sales and home improvement projects. Less affordability of big ticket items from carpets to kitchens will translate into fewer visits to sheds and showrooms. Consequently, other retailers sharing these retail park locations could also suffer a decline in traffic.
* The irrepressible impact of busier lives causing recreational shopping to get marginalised is an ongoing social trend. Finite leisure time and discretionary income at a time of expanding choice of competing activities will continue to suppress casual browsing.
Whatever else 2008 brings, retailers will be determined to make every customer count.
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