Bricks-and-mortar retailers up and down the country had feared a Christmas washout as the UK veered in and out of lockdowns at the end of 2020. 

Store closures hammered non-essential retailers and hindered their ability to drive sales during the most crucial trading period of the year. 

But many businesses fared much better than feared, due in no small part to their laser focus on ramping up their online operations and fulfilment capabilities to navigate the impact of the coronavirus pandemic.

Retail Week looks at some of the golden quarter’s standout online successes and the lessons that other retailers can learn from their exploits.

  • Dixons Carphone CEO Alex Baldock says “the sustainability of stores is helped by us having a strong online business”
  • Seasalt’s Paul Hayes expects to build following strongest month for digital sales in December
  • Nick Jones explains how Joules avoided mistakes of previous Christmas
  • Hotel Chocolat boss Angus Thirlwell on how it doubled online capacity in less than six months

Burberry

Although Burberry’s overall festive sales dropped 4% to £688m due to the impact of store closures across its global estate, the business partially offset this decline through a strong performance in ecommerce.

Burberry app

Burberry used new technology to replicate the in-store experience in ecommerce

The luxury retailer’s full-price digital sales surged by more than half in the 13 weeks to December 26. Burberry attributed those gains to the fact its collections and communications “resonated well with new, younger clientele as well as existing customers”.

The fashion brand focused its localised ecommerce efforts in China, where the luxury market has rebounded substantially since the initial outbreak of the Covid-19 pandemic a year ago.

A series of online activations were launched to drive sales in the country, most notably on Tmall’s Super Brand Day – Burberry broadcast a live stream, which combined products from its spring/summer 2021 collection with performances from the hit programme Street Dance of China. These videos were watched live by 28 million viewers and gained 20 million comments, likes and shares.

Burberry’s show on Super Brand Day sparked the biggest day of sales in the luxury retailer’s history and helped it connect the brand with new customers across China. 

As well as livestreams, Burberry launched covert sales events to drive further engagement from Chinese customers through different channels. A collaboration with local influencer Mr Bag on a bespoke pocket bag was made available to shoppers exclusively on WeChat. Burberry made just 100 of the bags, which were not available for sale on any of the brand’s own digital platforms. The range sold out within 60 seconds. 

Burberry also invested heavily in its ecommerce capabilities during 2020 – a strategy that bore fruit over Christmas as it attempted to replicate the in-store shopping experience online. Visitors to its website were able to explore fully styled outfits online, allowing them to shop for a whole look rather than one item at a time.

The brand also started adding video and animation capabilities to products so that customers could see items from all angles and offered access to online sales associates to help with styling, sizing and recommendations through a new chat function in real-time – just as if customers were shopping in-store. 

Hotel Chocolat 

In mid-March, Hotel Chocolat found itself in a bind. For a business that had started life as a catalogue home delivery service, it had predominantly been driving growth since through the strength of its product and by rapidly expanding its store estate.

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Hotel Chocolate increased online capacity and attracted new customers

As Covid-19 spread across the UK, the chocolatier realised that tumbling footfall and the potential for lengthy periods of store closures could hit the business hard, particularly during the crucial Mother’s Day and Easter trading periods. 

In response, the retailer took proactive steps. On March 20, 2020, days before the first lockdown was implemented, it announced a £20m share placing to help it “improve distribution and warehouse capacity to meet future growth ambitions and build resilience in the supply chain”. It said the fundraising would help to spearhead “five years’ growth potential”. But it also paid dividends at Christmas. 

Hotel Chocolat’s sales during the 13 weeks to December 27 climbed 19% despite the fact stores were closed due to tier restrictions, as its online performance “more than offset the impact of the temporary closures of physical retail”.   

Co-founder and chief executive Angus Thirwell explains that the business reaped the rewards of accelerating its digital aspirations, including by snapping up more space at its St Neots warehouse – a move that allowed it double its online capacity almost overnight. 

Thirlwell says: “We always had big ambitions to really accelerate our online business, but we anticipated that we would do most of those things over a couple of years. We ended up doubling our capacity in less than six months.” 

With added online capacity in place, Thirlwell says Hotel Chocolat focused heavily on its marketing of new innovative products to bring new customers on board.

“Our marketing team did an outstanding job bringing in large cohorts of brand-new customers and we had some new product categories that were able to solve many problems,” he says. 

“Our Velvitiser home hot chocolate machines sold incredibly well, as did our vegan chocolate products. Our range of alcoholic chocolate beverages really spiked as well.”

Seasalt

Seasalt reported a 17% rise in sales during the five weeks to January 2, as a 95% spike in online revenues more than made up for the 44% slump of store sales during the crucial festive trading period. 

Seasalt

Seasalt sales originating via email hit increased 30% in December

The Cornish fashion and lifestyle brand says its online momentum has built steadily over the past few years but reached new heights in December. It registered record levels of new customers and enjoyed its strongest ever day, week and month for digital sales. 

Seasalt made several senior hires to bolster its online operation during the year including Tim Ryan as digital director and poaching Gap’s marketing director Amy Thom for the role of chief marketing officer. 

It used its closed stores as mini distribution centres to help fulfil online orders with small teams continuing to work in shops to process ecommerce purchases.

The retailer also used the fact that shoppers were spending more time at home during the pandemic as an opportunity to strengthen its brand through customer emails. Seasalt says these were “not just about selling product, but about telling great stories and supporting our community.” It is a tactic that paid off – sales originating via email hit record levels for Seasalt in December, jumping 30% year on year. 

Boss Paul Hayes says: “The business was already undergoing a digital transformation before Covid and that has been accelerated. We now make approximately two-thirds of our sales online and expect a much higher percentage of sales to be digital from now on.

“We pride ourselves on staying close to our customers, which is just as important online as it is in store. Our communication with customers has been authentic and built on the emotional connection we have with them and their love of Cornwall. Our stories attached to our heritage are key to what we do and it’s that authenticity we believe our customers enjoyed coupled with consistently great product.”

Dixons Carphone

Dixons Carphone leveraged its physical store estate and expert teams during the Christmas period, boosting its online sales through a combination of new digital initiatives. In its core UK and Ireland business, like for likes in electricals were up 8% in the 10 weeks to January 9, as online growth surged 121%. Its share of the online eletricals market increased 6% year on year as a result.

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Alex Baldock says Dixons Carphone’s new services ‘make the most of our strengths’

Spurred by the pandemic and the resulting impact on shopping habits, Dixons created ShopLive – a video shopping service that connects customers to store staff to guide them through the products and offer expert advice on what to purchase based on their specific needs.

From an initial launch with just 20 colleagues in June, Dixons scaled the service to more than 1,000 members of the team by Christmas, opening the service up to more of its customers. It helped provide shoppers with the reassurance and peace of mind they needed before making big-ticket purchases during the festive season. 

“This is one of those innovations that the bigger it gets, the better it gets”, says chief executive Alex Baldock.

“When customers use it – and those online we must remember are shopping in what’s a confusing and expensive category where they value the face-to-face – it has some interesting results. We’re seeing customers be a lot more satisfied, we’re seeing higher conversion rates and higher transaction values than unassisted online [shopping].”

Dixons Carphone also offered a one-hour, zero-contact order-and collect-service, allowing customers to have products ordered online brought to their car when they park up at a Currys PC World store – a fulfilment option that now accounts for 25% of its sales.

Baldock says it is another service that “makes the most of our strengths” by combining its physical estate with its online business. 

Baldock is convinced such a combination of physical and digital will continue to prove crucial for retailers well beyond the Christmas period as they adapt to the demands of a post-pandemic world. 

“What many of our store colleagues understand now is that with online and stores, we’re stronger together,” Baldock says. “The sustainability of stores is helped by us having a strong online business.”

Joules

Joules delivered a strong performance this year, bolstered by its online division. After 2019’s disappointing Christmas results – festive sales were hampered by stock availability issues following a spreadsheet error – Joules redeemed itself this Christmas having made doubly sure that stock levels kept up with customer demand.

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Nick Jones says Joules was prepared for the unexpected at Christmas

Total retail sales raked in through its online channels, including its Friends of Joules marketplace, grew 66% year on year during the seven weeks to January 3.

Trading in stores was derailed by ever-changing government regulations in November and December but Joules kept its stock in central distribution centres until the last possible moment. That ensured it had strong stock availability in whichever channels were allowed to operate during the golden quarter. 

“The way that we traded through Christmas was pretty unexpected in terms of stores opening and closing. We’d seen enough indicators of where customers were likely to go,” Joules chief executive Nick Jones says. 

“With our brand presence and product that we’ve got, we were confident that we had a good product mix, it was just about juggling the channels and the availability.” 

When it became clear that online was the channel where the majority of customers were going to shop for Christmas gifts, Joules diverted its stock to service online orders, delivering straight to customers’ homes from central warehouses, rather than distributing stock to stores.

“We made sure that we kept stock at our distribution centres for as long as possible, really anticipating that digital was going to be where most of the customers would go and that was actually the case, so we were set for it,” Jones added.

Joules’ digital marketplace aided its online growth as the wealth of gifts, decorations and personalised items appealed to customers looking for something more unique. It demonstrated the value that retailers can unlock by opening up their online channels to third-party brands – the likes of Next and Marks & Spencer are pursuing similar marketplace models as part of ongoing efforts to grow their audiences for life, not just for Christmas.