RETAIL FORECASTS REPORT 2021 | BDO LLP
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As well as impacting what consumers do (and don’t) buy, the pandemic has created seismic changes in how and where they shop, rapidly accelerating some trends, reversing others, and even introducing whole new ones. Online spending has surged, especially in food and grocery, as the physical restrictions and health concerns surrounding the pandemic have led consumers to shop from their homes via computers, tablets and mobiles, before collecting their orders or having them delivered to their homes. In particular, the events of this year have been a catalyst for older shoppers who may have previously found the technology involved in online shopping unappealing to shift, their spending to the internet. Many are unlikely to reverse this behaviour, having grown appreciative of the convenience and value to be found shopping online, with 38% of consumers aged 65+ saying they will buy more products online rather than instore in the ‘new normal’ world. It is again high streets, so beleaguered over the past few decades that have once more borne the brunt of the pandemic turbulence. Springboard data in October revealed year-on-year footfall was -40% for high streets and -34.6% for shopping centres. Not only have they lost convenience-led shoppers looking to purchase items such as food and personal care products, they have spent less on clothing and other non-essential items as well as transferred remaining spend online.
Summary of Latest GlobalData forecasts for 2020 online growth by sector
CATEGORY
2020 %GROWTH
Clothing & Footwear
7.4
Electricals
22.0 22.1 31.7 32.9 39.5 38.8 86.5
Furniture & Floorcoverings
Health & Beauty
Total retail Homewares
DIY & Gardening Food & Grocery
Consequently, store numbers have slumped once again and the long-running questions about how town centres can best be revived and adapted to serve local communities are likely to once more rise to prominence in post-pandemic political discourse. Retail parks have generally proved more resilient. Springboard data in October revealed year-on-year footfall in these locations was down just 13.2%, a combination of both the retailers that where they shop, rapidly accelerating some trends, reversing others, and even introducing whole new ones. As well as impacting what consumers do (and don’t) buy, the pandemic has created seismic changes in how and
typically occupy these spaces, such as supermarkets, DIY retailers and value players, and their ability to adapt to COVID-19 secure shopping, as a result of their larger stores being more able to accommodate social distancing and one- way systems. The performance of local and convenience stores has varied considerably depending on location. Those located in villages, suburbs and residential areas have seen considerable uplift due to the shift to working from home and the outlook for these stores is positive for the same reason. However, those positioned in town centres and outskirts that rely on footfall from office workers have seen an exodus of spend and face the prospect of it never returning to previous levels
LOCATIONS/CHANNELS Change in UK Consumer Shopping habits for regularly bought items across key location October 2020
DAIRY PRODUCTS
PERSONAL CARE
CLOTHING & FOOTWEAR
HOUSEHOLD CLEANING
Online
+15%
+5% -8%
+13% -14%
+2% -22%
Local supermarket/convenience store
-5%
Chart shows the proportion of shoppers saying that, since the COVID-19 outbreak, they have shopped more at that location for these products, minus those saying they have shopped less. Data is from GlobalData’s Coronavirus recovery survey, which surveyed 500 nationally representative consumers in October 2020.
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