Mark Hook, Global PR Director, Brightpearl considers the long-term impact of Covid-19 on the retail industry.
The pandemic has placed a huge strain on British retailers. There’s no doubt it is creating dramatic changes in how and where we shop, and its likely we’ll new trends over the next year as we become more adjusted to changes in income and at-home working patterns.
The New Covid consumer
A recent new study by Brightpearl has thrown up some surprising insights on how we’ll shop next year, with Brits expected to up their online spending by more than 40%. One of the more interesting shifts in spending habits since Covid though has been the switch to more local shopping and a move away from chains.
In a change that reflects our increasing at-home working environments, 63% of British shoppers said that they will shop more with local businesses over the next 12 months. This demonstrates the profound effect that the Coronavirus has had on our day-to-day thinking, habits and behaviours.
In the midst of a pandemic this behaviour might be excused as being a response to the ongoing fear of the virus. This argument implies that when the pandemic eventually comes to an end, we’ll slip back into old shopping routines – but is this really the case?
The new consumer study seems to suggest that our local shopping behaviours will not be reversed, with 7 in 10 people who have switched to shopping locally planning to continue those habits throughout the next year. What’s becoming clearer is that local High Street shopping is more compatible with our working from home routines, and these destinations may prosper over the next 12 months.
Retail Must Think Local in 2021
Renewed support for local stores is a positive – but it’s likely to come at a cost for retailers and brands located in city centres with a predicted 67% drop in city centre footfall over the next year, according to the same research.
A significant proportion of retailers – 1 in 5 – are now actively planning to move stores out of major city centres and into local high streets within the next 12 months, and this could have a hugely significant impact on the makeup of local communities.
But with customers relocating online and of course to the suburbs and rural towns retailers have to respond quickly to these covid-inspired changes, and do so with greater levels of innovation. At Brightpearl, many companies we work with are already looking into adding more delivery options which support customers’ increased preference for local shopping – a strategy that makes a lot of sense. In a world where consumers will almost certainly want the option to pick up their online shopping from a local collection point, online retailers should consider adding local Click & Collect points to their delivery offering to capitalise on local footfall and increase revenues.
This is no easy feat though, and retailers and brands offering local collection, potentially at hundreds of locations across the country, will need an accurate picture of inventory so that shoppers can select the most convenient location and not be disappointed when they arrive to pick up their product. To pull off this service successfully, companies will need systems underpinning their retail operations that enable this type of advanced fulfillment – alongside flexibility in how orders are fulfilled, and the ability to accurately manage multi-location inventory management.
Embrace New Trends For Long-term Gain
Consumers may have begun shopping closer to home out of necessity but they are rediscovering local shopping, they like it, and this trend will be sticking around for the long-term.
The old normal of 2019 and the early months of 2020 are almost certainly gone for good, and retailers and brands must wake up to this reality. A new customer has emerged with different priorities and expectations. Smaller players that are able to make rapid adjustments, utilize systems and tools to offer new local services and experiences – and pre-pandemic levels of convenience and speed to boot – can be more competitive and reach many new customers over the next year.
Covid may have breathed new life into the local High Street, but the onus is now on retailers to realise the long-term potential this trend presents.
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