Mintel’s Month in Retail highlights the stories that have made headlines in the European retail markets over the past four weeks, with exclusive analysis from Mintel’s expert retail team on potential implications. UK: Retail sales grow 2.9% in September Sales in September grew 2.9% compared to the previous year, marking a slowdown compared to the 4.5% growth in August and 3.9% in July. Compared to August 2016 sales in September grew by just 0.1%. “The figures aren’t as good as the freakishly good numbers over the summer, but this is still a solid result and above the trend for the first half. Food had a reasonable month (+1%), but it is the specialists who are performing best at +8.5%, very much as one would expect given the trend back to shopping locally and from C-stores. Clothing had a bad month – down 6%. Much of that is down to the disappearance of Bhs, but not all. The weather was not helpful, but October should be better in that respect. DIY had a poor month – down 5.5%, which makes the figures from Wickes yesterday look even better than we thought. There’s no evidence here of consumers worried about the consequences of Brexit, or of any upward pressure on prices from the weakness of sterling. That reinforces our confidence in our forecast of 2.5% growth in December this year.” Germany: Kaufland launches online delivery service German discount retailer Kaufland has launched online from 5 October 2016. Initially, a trial is being run in Berlin, enabling shoppers to order online from a wide range of Kaufland products at the same price as in store. Shoppers must spend over €40. “Mintel research shows that some almost a third of consumers in Germany shopped online for groceries in the six months to May 2016, rising to 45% of those aged 16-24. Mintel data also shows that Kaufland’s current consumer base skews slightly younger than many of its rivals showing that this is a service that is well in-tune with its current shoppers. However margins are thin online, a reason why sister retailer Lidl and rival Aldi have only made tentative steps into non-food and alcohol online, which is perhaps why this is a trial service to test if the economics of running a discount model and a full online grocery service stack up. What is clear is that online grocery continues to grow in popularity across Europe and the steps the discounters have made both in Germany and abroad to offer goods online are a recognition that they have to find a workable solution to online selling from a discount proposition.” UK: Matalan opens first standalone home store As it continues to expand its furniture offer, the value operator has launched its first standalone homestore in the UK. Matalan’s furniture range was previously only available online. The retailer has reworked an existing branch to create the format and the refurbished store incorporates inspirational room sets to showcase the retailer’s furniture range. “Matalan has been struggling. Profits held up well until 2015/16, when they fell by almost three quarters. But sales per square metre have been drifting downwards from their peak over 10 years ago. The underlying problem is – how do you persuade people to drive to an out-of-town store for basic, if good value, clothing when there are retailers such as Primark on the high street. So it makes sense to experiment with a fully-fledged homewares store, a sector much better suited to out-of-town trading because of the amount of space that furniture needs to be displayed. Perhaps we’ll see Matalan make a transition from being a clothing to homewares specialist in the same way that Laura Ashley has done.” France: Carrefour launches one-hour food delivery in Paris The grocery giant has launched the online portal Livraisonexpress.fr which allows shoppers to order a range of drinks, grocery products and fresh food for delivery within the hour. Since orders are delivered from physical shops, they can only be completed during store opening hours. “Mintel research found that a third of French consumers have shopped online for groceries in the six months to May 2016. Whilst much of the online growth in France has come through the popular drive-thru collection method, for those living in urban areas this is less convenient. So it makes sense that as one of the largest grocery players in the market Carrefour is looking to serve urban dwellers with the fastest possible service. With Amazon launching its one-hour Amazon Prime Now service back in May and rumours that Amazon is looking to expand the markets it operates Amazon Fresh in, then this may be a shrewd move to get ahead of the pack.” UK: Missguided moves into beauty retailing Online youth fashion retailer Missguided has expanded into beauty with a range that is available online and in Boots stores. The cosmetics range includes contour kits, eye palettes, nail and lip products, with prices ranging from £5. “Missguided’s core customer base is those in their teens and early twenties. Mintel research shows the company’s beauty launch is likely to capture an active demographic, with around three quarters of females aged 16-24 purchasing make-up products in the last year. The fashion retailer is not the first to make the move into beauty; however, its success in the trend-driven, youth fashion market gives the brand a strong position to do so. Like other fashion retailers, the addition of a beauty range is a natural progression for the retailer. Missguided is adept at using influencers to help boost its profile and we expect the retailer to do the same with its beauty range.” UK: Wickes introduces one hour delivery slots In a first for the UK DIY sector, Wickes has introduced one hour delivery slots that let online shoppers choose the exact hour to receive their order. Shoppers must spend a minimum of £9.95 to qualify and the service is being rolled out nationwide following an initial trial. “Online continues to play a relatively small role in DIY retail with online sales estimated to account for just 8% of Wickes sales in 2015. Mintel’s research shows that product quality is one of the most important factors when making a DIY purchase, yet three in five shoppers agree that judging the quality is difficult when buying online. Fast and reliable delivery times should help online sales to grow, especially for repeat purchases or trusted brands, but showrooms that allow customers to see, feel and test the quality of a product prior to making a purchase will continue to be an essential part of the DIY shopping experience.” You might also be interested in: Taking Stock: The Month in Retail Taking Stock: The Month in Retail (September) Taking Stock: The Month in Retail (August) AmazonFresh: Just another online grocery service?