By Utku Tansel LLB, MBA
Utku Tansel, beyond being one of the nicest people I know, is also one of the smartest. Long experienced in researching and analyzing the consumer products industry, Utku has provided us with this look at the Covid-19 and its impact on the United Kingdom’s retail sector. His observations have value not only for those working in the U.K. but also in any country experiencing the impact that governmental preventative measures have on the health of the private sector economy. Below is part 1 of Utku’s 4 part series:
As the COVID-19 pandemic has transformed shopping behaviour completely making a profound effect on the retail industry in the UK, in a series of posts Utku Tansel LLB, MBA – Consultant will investigate,
- The biggest shifts in shopping behaviour since the outbreak began in the UK,
- Which retailers have responded the most innovatively and
- The legacy of these shopping behaviour shifts.
The Impact of COVID-19 on UK Retail and E-commerce – PART 1
The COVID-19 pandemic has transformed shopping behaviour completely in the UK making a profound effect on the retail industry.
One of the biggest outcomes is the accelerated shift to online which has resulted in booming e-commerce while traditional shopping experiences are challenged. According to UK online retail association IMRG, online sales grew by a substantial 58% in the second week of November 2020 compared to the same period last year. Office for National Statistics (ONS) data highlights that in October 2020, the proportion of online sales reached 28.5% up from 20.1% in February 2020 while online food sales increased by 99.2%, department stores by 87.2% and other non-food stores by 89.7% when compared with the same month a year earlier.
Since the outbreak began, delivery and click-and-collect have also enjoyed growing popularity. Spending more time at home has encouraged more consumers to embrace direct-to-consumer (DTC) particularly in grocery and clothing. Packaging in grocery has also become a key priority due to rising hygiene concerns,
Furthermore, Brits have embarked on to shop more locally while ethical consumerism has gained traction especially concerning the treatment of staff, vulnerable consumers, or NHS workers. Climate change awareness has risen as the “new normal” prompted more people to make eco-conscious purchase decisions.
Besides, the economic downturn has driven consumers to seek value and many turned to bargain hunting. In light of COVID-19, evolving e-commerce has also brought social shopping to life more rapidly and shoppers are becoming more comfortable with the experience. Facebook, Instagram, Pinterest, and TikTok all aim to capture more of the social commerce market.
Kelvyn Gardner from Asgard Media said “The crisis has also triggered many independent and small retailers to rethink their operations and offer online services. As a result, consumers are rediscovering these outlets”.