Almost £3bn in sales might shift online this Christmas, but don’t underestimate the draw of the store, writes Gemma Goldfingle
There’s no getting away from it. The closure of non-essential shops in November, including over Black Friday – the new peak of Christmas – will have a devastating effect on retail.
Retail Economics forecasts that sales of non-essential items will plummet £6.75bn during England’s four-week lockdown.
Of course, the big winner from this will be ecommerce, with Retail Economics estimating that around £2.9bn in sales will shift online.
Despite the sales shift, don’t disregard the importance of stores this Christmas. Retailers certainly aren’t.
This week retailers such as The Entertainer and Dixons Carphone extended opening hours in the run up to Thursday’s lockdown to capitalise on a last-gasp rush of demand.
Social media was also awash with images of queues outside stores – and for once, it wasn’t people vying to grab family-size packs of toilet roll at their local supermarket. PwC director Kien Tan posted images of a queue of people lined up outside H&M and Monsoon stores – an unfamiliar sight.
This lockdown must be bad... there’s a queue to get into the world’s quietest H&M pic.twitter.com/6TJxjuwfqy
— Kien Tan (@kien1974) November 4, 2020
It’s clear for some that stores are still integral.
And despite the quietest year the high street has ever seen, retail bosses expect shoppers to return in their droves when shops hopefully reopen in December. Both Primark and Marks & Spencer want to extend opening hours to cater for pent-up demand.
It’s unsurprising that Primark is pushing for this. The fast-fashion retailer does not trade online and drew the biggest crowds on the high street when stores reopened after the first lockdown
“Despite the quietest year the high street has ever seen, retail bosses expect shoppers to return in their droves when shops hopefully reopen in December”
However, M&S clothing and home sales were down 21% in its second quarter to September 26, a period when its stores had reopened.
Boss Steve Rowe is clearly expecting shoppers who have so far been reticent to return to stores after lockdown, to hit the aisles to find the perfect pair of Christmas pyjamas for Auntie Jean.
Rowe said he is “lobbying quite hard with the rest of the industry for the extension and deregulation of some Sunday hours, particularly as we get closer to Christmas”.
The retailer has already reportedly extended trading hours in its food business, which will remain open over the next four weeks, but wants to extend this to its clothing and homeware division in the run-up to Christmas.
Winning last-minute spend
Stores will also be an important channel in lockdown mark two as the government has stipulated that shops are allowed to offer click-and-collect services as long as items are collected “off the premises”.
Of course, that will provide little respite for stores on prime high streets and destination city centres as consumers are unlikely to trek to these locations to pick up a parcel. However, local high streets and retail park stores could benefit.
This could also prove invaluable as delivery capacity is likely to be stretched as Christmas shoppers are forced to order online in November.
“It’s perhaps in December that click and collect could come into its own. With delivery capacity likely to be stretched because of the volume of online orders, delays are expected”
But it’s perhaps in December that click and collect could come into its own. With delivery capacity likely to be stretched because of the volume of online orders, delays are expected.
This may well put shoppers off home delivery in the week before Christmas so offering an efficient click-and-collect operation could help retailers grab last-minute spend this year – and some generous shoppers might also pick up some socks for Auntie Jean while they’re in-store.
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