UK retail sales to US shoppers grew by 27% in May, as American consumer confidence hit a six-month high, contributing to a transatlantic spending spree. The boost in sales marked the ninth consecutive month of double-digit sales increases to American visitors.
In addition to the increase in overall sales, the average spend by a US shopper in the UK also rose, to an average €474 in May - €110 higher than the €364 recorded a year earlier.
Currency fluctuations will likely have enabled this, with the US dollar strengthening against the pound by 4.9% from May 2018 to May 2019 and by 5.5% against the euro in the same period.
The sales figures come from international payments company Planet, who facilitate VAT refunds for international shoppers – an indicator widely seen as an accurate barometer of the purchasing power of different nations’ tourists and the retail attractiveness of the countries they visit.
The UK proved popular with international shoppers more broadly in May too, with a sizeable 11% year-on-year uptick in arrivals coinciding with 3% growth in Tax Free sales. This builds on an already successful start to the second quarter, with Tax Free sales in April witnessing 15% growth compared with the same period last year. UK sales to international shoppers have now grown in four of the last five months.
Traditionally a destination famous for its heritage and tourist activities, the UK typically has registered a lower average transaction value (ATV) among international shoppers than other major destinations such as Italy and France.
RPA Perspective Figures from recent months have shown a steady rise in the average spend per purchase by international shoppers, with UK retailers witnessing 12% growth by this measure in May. More than this, the average ATV of the UK’s top-five source markets reached a 29-month high in May of €555 – the largest figure since January 2017.
“We’ve been seeing a shift in the way that the UK is positioned to international audiences recently. Once known predominantly as a cultural and heritage destination, shoppers from across the globe are now seeing the UK as one of Europe’s bigger-ticket luxury shopping destinations and are beginning to spend more per purchase while here,” commented David Perrotta, UK Country Manager at Planet. “This could indicate a bigger volume of high-value luxury goods being bought. We expect this growth in sales to international shoppers to continue in the coming months as we head into the summer holidays. Major events such as Eid al-Adha and the Cricket World Cup promise to bring shoppers from across the GCC nations and India to Europe and the UK – so it looks like UK retailers are set for a strong end to the second quarter.”
Retail sales to international shoppers across Europe more widely were also strong, with retailers witnessing 7% growth in sales and a 4% rise in ATV. Italy led the pack with the biggest rise in Tax Free sales, at 10%.
