RETAIL FORECASTS REPORT 2021 | BDO LLP
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KEY SECTORS IMPACTED AND EXAMPLES Fashion - Luxury retailers have perhaps had the biggest challenge, in trying to maintain the premium experience they offer in stores while becoming COVID-19 secure. The LMVH group has set up special appointment services in its Louis Vuitton stores, to ensure it can focus on offering a serene and positive customer experience, as well as the safety of its visitors, while in Le Bon Marché Rive Gauche stores it has assembled ‘Angel Teams’ of staff, who will assist sales staff in stores and provide masks and sanitisers to visiting customers. Health & Beauty – Specialists rely heavily on creating a sensory experience and allowing consumers to sample products, both of which are much more difficult in the current environment. Lush has responded by offering pre-filled samples instead of the product demonstrations it has previously been known for. SpaceNK has been pushing its virtual consultations for skincare, haircare and makeup, while virtual try-on apps have also become more significant, with the likes of L’Oréal’s Virtual Makeup Try-On being offered as an alternative to traditional samples. Grocery - Many grocers have introduced one-way systems, particularly in smaller stores. Though this restricts shoppers from wandering freely, it is an opportunity to increase dwell time and in some stores this may prompt additional impulse purchases, if products are merchandised strategically. The supermarkets are also experimenting with various new ways of keeping customer frustration to a minimum. Tesco and Asda are both allowing customers to wait in their cars, rather than queue up to get in, with the latter using an alert system to let customers know when it’s their turn to enter. Aldi and Lidl both have traffic light systems to control the flow of customers into their stores and have trialled click and collect services, while Morrisons, has introduced “speedy shopper” queues for those using baskets, allowing three basket users to enter for each trolley. How concerned are you about visiting stores and shopping outlets? UK consumers, October 2020
THE CHALLENGES OF RUNNING A COVID-19 SECURE BUSINESS
For many retailers the trend before COVID-19 was to move towards experiential retailing, but this has now been replaced with the need to deliver functionality and to provide a safe environment for staff and customers, by following Government guidance. According to a GlobalData survey from June, 74.7% of UK consumers expect retailers to make changes to their stores to reduce the risk of contamination. Almost all retailers have had to reformat stores to deal with the new challenges, providing screens and barriers, offering hand sanitiser stations and introducing one-way traffic flows. They have also had to introduce and monitor rules such as asking consumers to wear face coverings and not to touch products they are not going to buy; a marked contrast to the pre-COVID-19 shopping style. This has had the unfortunate impact of adding costs (Northern Ireland retail bodies alone reported their businesses had spent £10 million on COVID-19 security) while reducing footfall, posing substantial operational challenges and raising questions about how to offer a satisfying in-store experience within the scope of the new restrictions. Many retailers who invested heavily in COVID-19-secure premises have had to close stores anyway during Lockdown two, making it difficult to re-coup the investments.
Extremely concerned Quite Concerned Slightly concerned
17% 27% 32% 24%
Not concerned
Source: GlobalData
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