Consumers opt to shop local: UK convenience store sales growth more than double

 

       Photo: Urban coordinates from Hugo Boss/Facebook

Convenience store sales growth doubles between 2019 and 2020 while growth in shopping online is deemed to continue and the habit is “irreversible” according to experts.

Market intelligence agency Mintel has written in a new report that convenience store market is set to reach an estimated £47.5 billion in 2020, up 8% from last year,  revealing that 80% of convenience store users agree that convenience stores provide essential services in the community, as 25% of consumers say they are now shopping more with local businesses due to COVID-19.

The pandemic has given an impressive boost to convenience store sales this year helping the market grow by more than double the rate achieved in 2019. According to the latest Mintel research, convenience sales will grow by almost 8% in 2020 - compared to the 3% achieved last year*.   

The significant increase in in-home food and drink experienced as a result of COVID-19 will see the convenience store market increase from £44.1 billion in 2019 to an estimated £47.5 billion in 2020; this is despite the hit to ‘on-the-go trade’ such as items eaten out-of home - including those for breakfast and lunch. This rate of growth is outperforming the wider grocery sector, which is expected to grow by around 6% in 2020.

While Brits flocked to local stores during lockdown, such a peak in demand will not continue into 2021, particularly if social distancing measures continue to be relaxed and consumer budgets are squeezed further. Mintel estimates a decline of -3.9% in the market in 2021, as it rebalances before reaching more consistent lower growth through to 2024 (of 2-3%) when the market is forecast to reach £49 billion. Overall, 94% of convenience store users (or almost 80% of all internet users aged 16+) use a convenience store at least once a month**. 

Nick Carroll, Associate Director of Retail Research, said: 

“The shift to localised shopping during the peak of COVID-19 has benefited the convenience sector, driving larger-basket demand and sales as consumers necessarily shopped more in their local communities. Longer term, the importance of convenience stores within these communities and consumers’ desire to support them will only be reinforced - providing a solid platform for convenience retailers to build upon." 

“Not all aspects of the sector, however, are benefiting. On-the-go food and drink, for example,  is a significant part of convenience trade and has naturally been constricted by lower levels of public movement and more working at home since the lockdown. In particular this has impacted convenience stores in travel hubs. However, this decline in sales has been offset by more spending on in-home food and drink as shoppers look to shop closer to home.”

* Mintel’s latest estimates as of 18 June 2020; subject to change based on ongoing research and economic shifts

** Mintel commissioned research among 2,000 adults aged 16+ in March 2020

Mintel forecasts steady Christmas as British shoppers embrace Black Friday!

*Mintel forecasts December retail sales to be worth £48.7 billion 

*39% of consumers bought something during last year’s Black Friday promotions - Electrical items were the most popular purchases - bought by 49% of Black Friday shoppers

Love it or loathe it, Black Friday is now fully ingrained in the UK retail calendar.  While the official date of Black Friday isn't until November 29, many retailers are launching special deals starting from today, Friday, November 22, catching shoppers who want to do some early Christmas shopping.  

So whether you want to brave the high street full of bargain hunters and tourists or opt for shopping online in the peaceful home (or office) setting, there are serious deals and savings to be had, from electronic toys to games consoles, clothing, beauty and personal care.

Luxury Personalised Christmas Cracker - Family Treats by The Handmade Christmas Co. 

Black Friday is a tradition that originated in the US where retailers cut prices the day after Thanksgiving.  In recent years, UK retailers have hoped on the bandwagon and embraced it as a major annual shopping event in the run-up to Christmas.


According to retail and market experts at Mintel, last year almost two in five (39%) British consumers made a purchase during the Black Friday promotions.  Avoiding the retail rush, 86% of Black Friday shoppers bought online, while just under three in ten (29%) bought in-store. Amazon was the most popular destination, with 42% of Black Friday buyers shopping with the online giant during the event. 

ENGLISH LAVENDER COLLECTION By Yardley London

Overall, electrical items were the most popular purchases, bought by 49% of Black Friday shoppers, followed by clothing and footwear (38%) and beauty and fragrance (25%). 

Nick Carroll, Associate Director of Retail Research at Mintel, said:  “Black Friday is here to stay, and we expect it to be potentially the biggest it’s ever been in the UK. Unlike in recent years, Black Friday 2019 falls right at the end of the month - after payday and less than four weeks before Christmas. This makes perfect timing to capitalise on shoppers who are looking to save during this uncertain period.
Mintel forecasts December retail sales to be worth £48.7 billion 

Despite a particularly tough year, Mintel forecasts some Christmas cheer for Britain’s retailers. Latest research predicts that December’s retail sales will reach £48.7 billion, growing a respectable 3.8% compared to last December when sales hit £46.9 billion.  

 Personalised Christmas Bottle Bags can be ordered from Vanilla Reindeer.

Sales through non-food retailers this December are expected to reach £23.9 billion (including £4.2 billion from online sales generated by physical stores); while food retailers will enjoy sales of £18.8 billion (including £1.4 billion from online sales generated by physical stores). And in the battle between the clicks and bricks, Mintel estimates that internet pure players (online only retailers) will account for £6.0 billion worth of sales.

Mintel forecasts total online sales this December will be worth £11.6 billion, accounting for 23.7% of all retail sales.

Nick Carroll, Associate Director of Retail Research at Mintel, said: “The past few festive periods have shown that customers can be resilient in the face of uncertain times and we believe underlying demand will hold up reasonably well. Customers will, of course, be looking for value, and with fewer days between Black Friday and Christmas this year retailers’ margins may be particularly stretched.

“Although high-street retailers may be under pressure … those that can provide valued experiences whilst tapping into other underlying trends, such as local sourcing and ethical production, combined with attracting value-conscious shoppers, put themselves in a good position this festive season.”

While physical store profit margins more than halve in eight years in the UK, ‘Store of The Future’ flagship opens at Selfridges, London

Newly published data report that UK retailers are suffering from diminishing profit margins drawing concern for the UK overall economy, at a time that retailers are gearing for Christmas sales, even without complications of a general election.  However, those retailers, especially fashion brands, that are focused on the value, convenience and luxury segments remain generally resilient, compared to the struggles of mid-market operators.

Strategic partnership and in-store pop-ups give shoppers new physical retail experiences at a time when retailers

are faced with increased challenges presented by online shopping, growing operating costs and inflexible leases.

Photo by Lucia Carpio taken at London's Harvey Nichols during a recent pop-up shop launch.

The new study has found that store margins for the top UK retailers “have dropped from 8.8% in 2009/10 to 4.1% in 2017/18.” According to new data published by global professional services firm Alvarez & Marsal (A&M), in partnership with Retail Economics, store-based profit margins have plunged, faced with growing operating costs, inflexible leases and the rise of online shopping, thus leading to the steepest decline in shoppers’ footfall,  and resulting in a wave of store closures, while demand for UK retail space is at its lowest since 2007.

Richard Fleming, Managing Director and Head of Restructuring Europe, A&M, said a new era of retail is emerging, which means "new opportunities exist for forward-thinking incumbents, entrepreneurs and investors."

Despite the challenges in the sector, UK retailers are being urged to continue to invest in their in-store shopping experience, as bricks-and-mortar shops are expected to account for 65% of retail sales over the next five years.  And while the rise of online shopping has threatened the future of in-store shopping, the study found that 25% of Millennials and Gen Z continue to visit a flagship shopping destination at least once a week - more than their older counterparts, with 45-54-year-olds saying they visit on average just once every six months.

In London, luxury department store Selfridges has long been admired by its ability to strike a balance between offering desirable lifestyle goods and leisure through strategic partnership that gives unique experiences to its shoppers.  One of its newest additions is to have Smartech, an experience-led tech concept store, open a new flagship in the lower ground floor of Selfridges on London’s Oxford Street, within its tech-products section.
Smartech is a new “tech playground” where more than 80 carefully curated cutting-edge innovation pieces are on show to give visitors unique lifestyle experiences.  

Photos above and right by Lucia Carpio.

Fronted by exclusive robotics, IoT, smart art, FemTech, snaps-taking spectacles and the very latest in Deep Tech, it’s said to be the largest and most experiential shop-in-shop at the iconic London department store. 

Smartech is a concept store, designed with 

discovery in mind, created for people to have fun,

diving into a future filled with surprises 

Above, visitors engaging with Waterlight Graffiti, a surface made up 

of thousands of LEDs that are illuminated 

by contact with water, allowing the user to treat it as an electrical canvas.
Photo from Smartech. 

Dubbed by the Financial Times as “The Store of The Future”, Smartech is billed as "a window onto what the world’s creating, bringing life to a new era of ground-breaking makers, creators and start-ups."

Covering 200sqm, Smartech introduces a state-of-the-art store designed by renowned British designer, Robert Storey – previously of Prada, Hermes and Off-White. 

Smartech aims to open your mind to what culture, tech, art and sustainability will look like in the not-so-distant future. Incorporating contemporary and sustainable influences, Smartech’s innovation space “showcases a new design identity, embodying a never-before-seen mixed reality of tech and futurism combined with modernity,” according to founder Jacov Nachtailer.
He said, " Everybody is talking about innovation, but you don’t have a physical space to try, discover and buy. People come to Selfridges to discover, which is why they’re the perfect partner for Smartech, to amaze and amuse their customers with the world’s latest innovations.”

 

From MAKR SHAKER - bar-tending robots serving visitors' favourite cocktails in Smartech, Selfridges.

Photo by Lucia carpio

“As the digital revolution continues to transform everything from politics to pop music, we want give people who create things a platform to tell their story and shine light on new ideas. Pushing the boundaries of where tech, art and creation collide has been a driving force behind our success,” said Nathalie Bernce, CEO of Smartech.
Smartech has been turning the retail game on its head, with huge success, experiencing an aggressive global growth over the past three years and over 143% above target year on year,  In addition to Selfridges, Smartech concept stores are also found in high-end department stores around the world including Paris, Milan, Berlin, Amsterdam, Rome, Zurich and Copenhagen, with another 10 stores opening within the next 12 months.

UK INDEPENDENT RETAILERS JOIN GLOBAL BRANDS IN ONLINE “FLASH SALE”

Payments innovator Clearpay - UK arm of global payments innovator Afterpay Touch Group - holds first online discount event on three continents 

Independent retailers on local UK high streets are to reap the benefits of global e-commerce this week, offering exclusive online deals alongside top fashion and retail brands in a “flash sale” for UK shoppers, according to a press release from Clearpay.

At a time when many UK high street retailers are seemingly struggling to compete with the growing popularity of online shopping, Clearpay is holding a UK flash sale this Wednesday and Thursday when discounts of up to 60% are on offer to shoppers who pay with Clearpay, and consumers can spread the purchase price over two months in four debit payments.

The UK sale will run alongside Afterpay Day in the US, Australia and New Zealand – making this one of the first exclusive online shopping events with global brands to run across three continents, with over 30,000 retailers and four million consumers.   

Clearpay is an entirely new way to pay, being interest free, quick and easy to sign up and requiring only a debit card. Since launching in the UK two months ago, a host of UK retailers have adopted it for their customers, with almost all the biggest names joining, said Clearpay.

#ClearpayDay will be a 36-hour online sale for retailers offering Clearpay to customers, including many big names like Urban Outfitters and Boohoo. Deals on offer will typically give between 25% and 30% off, but some are much higher – with Pretty Little Thing offering 60% off all Clearpay transations and Nasty Gal discounts of 50%. 

UK shoppers will also find deals from local stores and boutiques via Down Your High Street, an online marketplace for independent retailers.  Down Your High Street is offering a discounts on all purchases made with Clearpay at over 600 small high street shops.  

“This is an innovation which levels the playing field in e-commerce, giving smaller independent retailers the same opportunities as top global brands to reach millions of consumers online with great deals,”  said Carl Scheible, CEO of Clearpay. “#ClearpayDay is game-changer – the first step in making the benefits of global e-commerce available to all.” 

Clearpay’s UK roll-out is part of a rapid international expansion by Afterpay Touch Group, working with a host of global retail partners. The group’s online store directories, more established and much bigger in Australia and the US, have become a shopping destination in their own right, says the Group, referring new customers to brands using the service, adding that both referrals and overall retailer sales are boosted by its flash sale events. 

Its ambition is for consumers to buy goods from any retailer in the world on its platform. Cross Border, launched in March, allows customers to pay in their local currency, for products then shipped from oversees by the retailer. Currently on trial in Australia and New Zealand, the intention is to roll this out internationally.   

UK Retail: Is Fashion fleeing the high street?

Following the news on Friday 15 March that Arcadia is reportedly poised to launch a CVA, Sofie Willmott, Senior Retail Analyst at GlobalData, a leading data and analytics company, offers her view on the chain's current challenges and the scenario on the UK retail market: click vs mortar.  Clothing & Footwear will the fastest declining sector in UK town centres over the next five years.

News that Arcadia is poised to launch a CVA comes as no surprise as clothing & footwear spend continues to shift online and rising operating costs make physical locations less viable, said Ms Willmott.

“(UK) High streets will be the hardest hit with already declining spend being further impacted by significant branch closure plans at Arcadia as well as major players Debenhams and Marks & Spencer. The shuttering of anchor stores in town centres will encourage consumers to go elsewhere to purchase clothing & footwear, negatively impacting other retailers in the area.

“GlobalData forecasts that clothing & footwear will be the fastest declining sector in town centres over the next five years with spend falling 13.8% between 2018 and 2023, versus the total town centres market which is set to decline 1.9%, propped up by essential product sectors namely food & grocery and health & beauty.

“While town centres accounted for over 40% of clothing & footwear spend in 2013, other locations which are better able to meet shoppers’ needs such as supermalls and retail parks, as well as the online channel, have tempted consumers away with high streets forecast to account for just 25.9% of spend by 2023.”

The Amazon effect - Nine in ten Brits shop on Amazon

British shoppers' love affair with online shopping is going from strength to strength and Amazon is now revealed to be the go-to retailer nine out of ten times.

The popularity of Amazon - the retail phenomenon which started in a garage and now, nearly a quarter of a century later - its success is unbelievable.  But believe it as new research from Mintel reveals that almost nine in ten (86%) Brits are Amazon users/shoppers. According to Mintel, more Amazon shoppers have increased their shopping (21%) with the retailer than decreased it (13%) over the past year. Overall, most (70%) Amazon customers shop with the retailer at least once a month, while just under a fifth (17%) use the retailer on a weekly basis.

In terms of what’s in the basket, hardcopy media (books, DVDs or video games) (39%) remains Amazon’s most popular purchases. This is followed by electricals (30%), fashion/jewellery (30%), and toys (20%). An impressive 45% of households in the UK have some form of Amazon produced device, with Kindle (23%), Fire TV/TV Stick (16%), Fire Tablet (14%), and Echo (11%) proving the most popular.

Inherent trust in this retail giant is confirmed by the fact that as many as half (51%) of Amazon users assume that the e-retailer has the cheapest prices, while six in ten (59%) say they are loyal to the company. What is more, 70% of Amazon shoppers say it is the first retailer they go to when shopping online.

Nick Carroll, Mintel Associate Director of Retail, said:

 

“Amazon is a phenomenon of 21st century retail. In a little over 20 years, it has grown to be a retailer that nearly all consumers use. It has achieved this through a relentless focus on customer-facing investment and innovation. Amazon started selling books, but now holds a significant share in almost all retail categories, helped by the incubation of thousands of independent sellers through its Marketplace scheme. The retail giant has expanded far past the bounds of normal retail operations into media streaming, consumer electronics and cloud computing. Amazon has built a platform that customers are both happy to use, and pay for the privilege of doing so via its various subscription services.”

“While most consumers already shop with Amazon, the retailer continues to gain market share by increasing the number of Prime members. That’s because Prime members buy significantly more, and across a broader number of categories, than non-members. This is why Amazon continues to add to the list of Prime-exclusive services, with Premier League matches coming in the second half of this year. Regardless of the reasons people join Prime - there is a net benefit for the retail side of the business,” Nick adds.

Amazon is not the high street killer

The impact of Amazon’s reach into the physical retail sector is confirmed by the fact that almost half (45%) of Amazon users believe that the e-tailer is responsible for physical stores closing. Meanwhile, three quarters (75%) of Amazon shoppers say they often check the prices of products they see in-store on Amazon. And physical retailers are probably being used as showrooms, as 70% of Amazon shoppers say they research products elsewhere but then buy via the site.

But while many acknowledge the negative impact of Amazon on the high street, some 40% of Amazon users believe it supports independent retailers and 29% believe that shopping via Amazon Smile is a good way to give to charity.

 

What will our high street look like in the future?

61% of Brits are worried the high street will disappear in the next 10 years

New research by KIS Finance has revealed that consumers are worried the high street is going to be lost completely due to the current store closures in the news. 

After surveying Britain’s consumers and finding out what the high street could look like in the future, KIS Finance have collaborated with Sam Edwards, an illustrator from London, to visualise these changes. 

Holly Andrews, Managing Director at KIS Finance says;

“With store closures flooding our news-feeds recently, we were interested to find out what the future holds for the high street and how consumers’ shopping habits might affect retailers’ footfall. It is obvious from our research that people do still like going into store to shop, but it just isn’t as accessible as online shopping is.

To save the high street many retailers need to ensure that they are thinking innovatively about how to draw customers in with clearer in-store stock checks, more staff and extended hours during busy periods. The reason why so many retailers are struggling with their stores is because consumer shopping habits are changing and the high street needs to change with it, creating a more community led atmosphere with more accessibility and variety for everyone.”

KIS Finance's recent research by KIS Finance has revealed the following after surveying 1,000 consumers in the UK:-

•61% of Brits are worried the high street will disappear in the next ten years due to recent store closures in the news

•Northern cities have by far been worst hit by store closures

•Food and beverage, value and fashion brands are predicted to be the next victims of the high street

•If local high streets had free parking and easy accessibility, consumers would be more likely to shop in-store

Mediaworks white paper: Online retailing key to fashion industry’s success

It has been reported earlier this week that visitor traffic to UK retail stores last month was down nearly 12% year-on-year and down close to 29% in the first week of the month.

According to Ipsos Retail Performance, despite Easter falling in March, footfall failed to pick up over the public holiday and that it was the 11th consecutive month that year-on-year store footfall has declined across the UK.

Photo © Lucia Carpio.

As often the case, the weather had been blamed as the culprit as much part of the nation experienced an unseasonal cold snap with a lot of snow.  But consumers did not need to stop shopping, especially for non-food items, even if they are stranded at home.

According to a recent study by Mediaworks, online retailing has been driving the fashion industry’s success.  Both luxury brands and high street retailers are turning to the online sphere to strengthen their brand.

Estimating that the global worth of fashion is £2.24 trillion, Mediaworks revealed that in 2017, the UK’s online fashion spend jumped to a huge £16.2 billion, while predicting it will increase by a further 79% by 2022.

Through the Fast-paced Fashion: The Digital Forecast 2018 white paper, Mediaworks examine the six key trends expected to impact the industry in 2018 and providing actionable insights for retailers.

First and foremost is Mobile First, as it is imperative for fashion retailers to fully explore and utilise their relationship with customers through their mobile phones.

Another key trend is Journey personalisation, which is essential in focusing on delivering an in-store experience online, as Mediaworks predict that by 2020, customer experience will become the main reason a customer will choose a brand over another, overtaking both cost and product.

Another trend is Voice search, as more voice searches are being carried out than ever before, and retailers need to cater to more conversational search behaviours, and the need to review existing content’s style, format and flow.   MediaWorks also urge retailers to consider implementing visual search, something retailers like John Lewis and Boohoo.com are already experimenting with.

Other trends include Customer Profiling, transitioning from segment-based to signal-based data to gain greater visibility while mindful of data protection and attribution is important for marketing success.

For more information about each of the above, visit digital marketing agency Mediaworks’ website to download the white paper.

Mixed results for UK retailers as December fails to match November online sales

It is indeed challenging times for clothing and food retailers in the UK these past six months or so, with political uncertainties and depreciating British Pound due to Brexit impacting on confidence and price inflation, not to mention the ever-changing dynamics of consumer shopping habits.

This week the market sees a mixed bag of post-Christmas results from retailers such as Marks & Spencer, Boohoo and Tesco.  According to customer engagement experts Optimove, the landscape of retail around the Christmas period is changing rapidly, with ill-planned discounting strategies hitting hard in a lean holiday season.

Pini Yakuel, CEO of Optimomve, comments: “Customers are beginning to buy online earlier in the Christmas and holiday period.  According to our analysis of customers in the festive season, total order amounts were 32% higher in November than December.

“The growing popularity of Black Friday and Cyber Monday are attracting large orders, but instead of increasing overall sales, this might encourage shoppers to make December purchases earlier at a lower price than they would without the discounts. This December saw a 10% lower order total than in 2016.

“Although heavy discounting can bring in more customers in one instance, retailers must be sure that this adds real value to overall annual revenue. We have found that heavy discounts of more than 30 per cent do not usually encourage customers to make a second purchase from the brand later in the year, unless it is a similarly discounted product.[1] While one-off sales provide some value, brands must focus on getting customers to keep returning to the brand to provide lifetime value."

More on UK Christmas 2017 retail sales analysis, click HERE.

UK Xmas retail sales grew 2.2 percent helped by clothing and food online

As online retail within the UK is predicted to continue to grow albeit faced with the challenges on retail logistics, spending on clothing and food online helped to boost UK retail sales growth of 2.2 percent over the December festive period, according to Mastercard SpendingPulse.

Among the big winners were clothing sales which increased by 13.7 percent year-on-year, however, luxury goods and jewellery were down by 3.4 percent and 5.6 percent, respectively on 2016.

Mastercard also revealed Christmas trading was tough with weaker footfall in the Boxing Day sales, largely due to holiday discounting that started earlier around Black Friday, which impacted the year-on-year results.

According to Scott Abrahams, senior vice president of business development at Mastercard UK and Ireland, there was a mixed performance among retailers although those British retailers with a strong online presence showed optimistic results.

“When looking at the year as a whole, 2017 saw retail sales increase 4 percent. Although Christmas trading was tough and showed a mixed performance among retailers, these results do show that there some areas of optimism for British retailers, particularly those with a strong online presence.”

Meanwhile Westfield, owned by Europe’s largest shopping mall operators, has revealed an increase of visitors over the Christmas period in 2017, registering 14.1 million shoppers at Westfield London and Westfield Stratford City, with an overall year-on-year 1% increase.

Westfield 's shopping malls experienced three peak trading periods in November and December, notably the Black Friday weekend that saw 850,000 visitors, the ‘Super Weekend’ (the last weekend before Christmas) with more than 800,000 visitors bringing the pre-Christmas week trade to 1.85m and the Boxing Day sales period with more than 320,000 visitors.

Myf Ryan, Chief Marketing Officer, Westfield UK and Europe, said by offering a mix of retail, dining, events, leisure and entertainment, Westfield had lured visitors away from the comfort of their home to their shopping malls.  

Over the Christmas period, we offered many unique and immersive experiences to our customers. With over 70 million visitors coming to the centres each year, we are looking forward to creating even more exciting experiences and activities for our customers to enjoy in 2018,” says Ryan.

Festive events created and hosted by Westfield included having pop star Gwen Stefani to switch on the Westfield London Christmas lights with a special festive performance and a “first to the UK ground-breaking technology” Star Wars: Secrets of the Empire hyper reality experience.

Bad experiences with delivery frustrate online shoppers

Bad experiences with delivery have been named by internet users as problems with online shopping, along with issues with collection as well as packaging wastage.

Market retail experts at Mintel reported that 62% of UK delivery users have experienced an issue with a delivery.

Mintel research reveals that a longer than estimated wait for delivery of products (30%) tops delivery users’ frustrations. This is followed by being unable to schedule a delivery for a convenient time (20%), deliveries being left in unsafe areas (18%) and damage to the content or packaging (17%).  Meanwhile, receiving incorrect products (12%) and difficulty arranging a re-delivery (12%) complete the nation’s top five delivery issues. Further down the list, one in 10 (8%) of those who use delivery most often say they have had a problem with unhelpful delivery personnel.

But it isn’t just delivery that is causing consumer angst, as collection is proving a cause for concern too.  Some 38% of Brits who have collected a product in the last 12 months have experienced a problem, with long queues (20%), unhelpful staff (12%) and out-of-stock products (10%) among the most common problems.

Nick Carroll, Senior Retail Analyst at Mintel, said:  “Online retail will continue to grow within the UK and with it the demands put on retail logistics. While instances of problems are lower among those who have collected a product, the issues users have reported seem avoidable from a retailer perspective. While a big positive of click-and-collect, from a multi-channel viewpoint, is that it allows store-based retailers to emphasise their brand traits when an online shopper comes into the store, if customers are faced with long queues, unhelpful staff or unavailable products, then the opportunity is lost and the benefits of coming into store are negated.”

Mintel estimates that the value of collection orders in the UK reached £9.5 billion in 2016, accounting for 18.5% of all online sales, with the market this year estimated to reach £11.8 billion, according to report published November 2017.

When asked which newer innovations in the delivery and collection market consumers would like to see become more widespread, evening home delivery (43%) tops the wish lists of those who use product delivery and collection.  While GPS tracking of orders (35%) and one-hour delivery slots (33%) complete the top three innovation interests.

Overall, 30% of delivery and collection users are interested in same-day delivery, with those aged 16-24 expressing the greatest interest in same-day delivery (41%). Despite this, the majority (87%) of users think that next-day delivery is quick enough for most purchases. Meanwhile, 46% of delivery and collection users say the ability to have products delivered before paying for them is appealing and a forward thinking one in 10 (8%) express an interest in drone delivery.

“Online retail shows no signs of slowing down and neither does the speed in which retailers are attempting to fulfil orders and how quickly consumers expect them to arrive.

“For leading online players, how they fullfil orders can be their defining quality, but there is evidence that speed is not necessarily everything; it is about offering a range of options to be flexible to consumers’ multifaceted demands.” Nick adds.

Meanwhile, 57% of users believe that retailers that sell online should offer a recycling service for old products.

Nick continues: “Consumers are becoming increasingly aware of how their consumption is affecting the environment. Greater online volumes that bring more waste packaging and delivery vehicles to serve the demand may see consumers more actively question how their shopping habits are affecting the environment. 

One way in which online retailers could limit this is to instigate a recycling service for old products. There are examples of store-based retailers who have introduced a recycling service at the store level and the majority of consumers seem to be in favour of online players taking a similar stance. This is a simple move, even if it is a logistical strain for the retailer to take. It could help reduce the impractically of excess packaging around the home, and encourage greater purchasing.” Nick concludes.

Black Friday sales reveal online shopping behaviour and shoppers' loyalty

Analysis of over 7 million unique e-commerce transactions this Black Friday has revealed discounting falls as order amounts rise.  This is good news for retailers, as the average discount on an order decreased by 12 percent compared to last year, whilst the average order amount grew by 9 percent compared to that of 2016.

The data, from customer relationship experts Optimove, suggests that online customers in the UK were willing to spend more on more items on Black Friday 2017.  The average number of items in an order grew by 7 percent compared to last year’s sales day figures. Customers did not insist on receiving such big discounts in order to complete their transactions.

"It is clear that more shoppers are opting to buy online rather than in-store."

Pini Yakuel, founder and CEO of Optimove, comments: “As the numbers come in after Black Friday, it is clear that more shoppers are opting to buy online rather than in-store. Which is why it is more important than ever that retailers understand the behaviours and motivations of their online customers.

“Contrary to traditional analysis of the Black Friday phenomenon, our data shows that most of the individuals shopping with a brand on the day are actually returning, rather than completely new, customers.  On Black Friday last year, our research showed that 71 percent of shoppers had bought something from the brand before at some stage. And this trends continues.

"There are signs that days like Black Friday may be helping retailers to keep customers coming back to their brand." 

“This year, the share of Black Friday transactions which were made by first-time shoppers decreased by a further 18 percent. Customers’ pre-existing contact with a brand goes some way towards explaining why shoppers have been willing to buy more items without such high discounts this year.

“Despite the supposed ‘death’ of customer loyalty, driven in part by the ease of price comparison online, there are signs that days like Black Friday may be helping retailers to keep customers coming back to their brand.

"The challenge for retailers is to continue building on this relationship outside of the pre-Christmas and sales period."

“If retailers can continue to exchange value with their online customers – offering specific offers, personalised communications and experiences – then these positive trends can continue into the sparser months, January and beyond.”

London retailers ready to cash in on Chinese New Year ‘gold rush’

Happy Chinese New Year from all at My Fashion Connect Global.
Photo: Lucia Carpio

As Chinese New Year kicks off on 28th January this year, ushering in the Year of the Rooster, it also signals the start of "Golden Week" - a key calendar date now for UK retailers as they are doing all they can to attract Chinese shoppers, including offering multiple shipping options at reasonable rates, and even displayng prices in Chinese yuan.

Chinese tourists are taking advantage of the weak Sterling to travel and go shopping in the UK, and are expectecd to spend the tune of £11m in London during this year’s “Golden Week”.  
Department stores and luxury retailers are expected to be the biggest winners as reported by Drapers trade publication.

According to payment firm Worldpay, Chinese tourists spending went up 24% in December compared to the same month in 2015.  During the Golden Week, Worldpay says Chinese shoppers are expected to spend 40% more on credit cards than usual during the holiday, and popular shopping destinations in the capital are expected to reap the benefits from the influx of free-spending tourists.

Jace Tyrrell, chief executive of the New West End Company, also reportedly said sales to Chinese shoppers were up 121% on 2016 in the week prior to the main event. To put this into perspective, domestic and European spend in the same period were up by just 10.2% and 12.6% respectively.

“Although the holiday was traditionally used for family get-togethers, more and more Chinese citizens are opting to use the break as an opportunity for travel.”

UK's Retail Sales Grow Slightly Faster than expected, says CBI

One word that sums up fashion of 2016 is nostalgia.  Despite rapid changes in world retail trends and technological developments, it has been a year of looking back to the past and reworking ideas taken from previous eras.

The prestigious Selfridges fashion department store on Oxford Street in London harks back to the Seventies for its shop windows this festive season.
Photos: Lucia Carpio

So much of the year-end reviews had been made in the context of a world dotted by upheavals.  No wonder people were feeling nostagic of better days of the past.  Let's hope that fashion in the coming year will begin to step away from the familiar and take us onto newer paths.

Meanwhile UK's retail sales growth accelerated in the year to December, with volumes rising at the fastest pace since September 2015, according to the CBI’s latest monthly Distributive Trades Survey.

The survey of 112 firms consisting of 53 retailers showed that sales volumes for the time of year were considered well above average, but growth is expected to slow somewhat in the year to January.

Separastely, orders placed on suppliers rose at the fastest pace in over a year, but are expected to be broadly stable in January.

The growth of retail sales volumes was broad-based, with sales of clothing continuing to perform strongly and grocers reporting the best results since January 2016.   Internet sales volumes continued to rise at a robust pace in the year to December, with the survey balance at its highest since November 2014.

Meanwhile, wholesaling reported the strongest volumes growth for almost a year-and-a-half in the year to December, with motor trades also seeing a healthy increase in sales volumes.

Ben Jones, CBI Principal Economist, said in late December:
“It’s encouraging to see retailers reporting another month of healthy sales growth leading up to the festive season, which rounds off a fairly solid quarter.
While we still expect to see decent growth in the near term, the pressures on retail activity are likely to increase during 2017, as the impact of sterling’s depreciation feeds through.
With higher inflation beginning to weigh on households’ purchasing power, consumption patterns are likely to shift, creating winners and losers across the retail landscape.”