The London 2012 Olympics provided a welcome spike in public morale in the U.K. But for retailers, the games brought only a slump in trade, with like-for-like sales falling 0.4% in August compared with the same month in 2011.
Party and barbecue food and drink sales showed a slight increase as people gathered together to enjoy the games -- which were shown only on the ad-free BBC -- but this was more than offset by the weak performance of other categories, according to the British Retail Consortium-KPMG retail sales monitor. Spending on women's clothing, furniture, flooring and home items were particularly hard hit.
The worst effects were felt online, with sales growing only 4.8% in August, compared with growth of 10% to 20% every other month since records began in October 2008. The BRC said that online sales were especially weak in the evenings, as people followed sports on their computers and mobile devices instead of shopping on them.
Stephen Robertson, director general of the BRC, said, "There's no evidence here of any Olympic boost to retail sales overall. It's clear that people were absorbed by the Olympics and had little interest in shopping, especially for major items."
Helen Dickinson, head of retail at KPMG, said, "Retailers' hopes that the Olympics would inspire a pickup in spending were dashed as shoppers stayed away from the high street and enjoyed the sporting spectacle from their armchairs. While the Olympics brought a much needed boost to consumer confidence, the country was 'otherwise engaged' in August and the sales figures show a mixed picture."
August is traditionally a weak month for sales, and retailers are eager to see if activity will pick up in the fall. Mr. Robertson said, "As summer gives way to the all-important Christmas run-up, retailers will be hoping sales that didn't happen in August have been postponed and not lost entirely."
Costing an estimated $14 billion to stage, with about half the funding provided by sponsors, the Olympics haven't all been bad news for business. Procter & Gamble has said that it expects to gain an extra $500 million in consumer spending thanks to its sponsorship of the games, and another sponsor, Adidas, announced Olympic licensed product sales rose 250% compared with those for the Beijing 2008 games. Meanwhile, U.K. bike shop chain Cycle Surgery reported record sales during the Olympics, spurred on by Team GB's success at the velodrome.