Extinction Event: Shoppers may never return to the High Street

The Office of National Statistics (ONS) retail sales estimates for March, published today 24 April, have confirmed dire forecasts for the future of the High Street.

The figures show a -5.7% decline in the overall amount spent by shoppers compared with February, the steepest drop since the ONS started predicting figures.

In contrast, online sales rose to take 22.3% of all sales; e-commerce sales rose 12.5% year-on-year in the wake of the COVID-19 epidemic. 

The Covid-19 outbreak will be an extinction level event for the High Street, wiping out many fashion and department store giants, unless brands embrace omnichannel – integrated High Street and online sales – as never before.

The value of clothing sales in non-food stores crashed by -35.5% month-on-month, for example.

Back in 2016, our report, Death of the High Street, predicted half of the UK’s existing High Street businesses would collapse by 2030.

With Animal, Oasis, Warehouse, Laura Ashley, BrightHouse, Cath Kidston and Debenhams all entering administration in recent days, we believe COVID-19 has simply hastened their demise.

Truly embrace omnichannel sales

Britain’s big retail brands must truly embrace omnichannel sales, with a completely integrated online and in-store experience, once social distancing measures are relaxed. Otherwise, Britain’s shoppers may simply lose the habit of visiting stores.

A number of online retailers, particularly in the groceries sector, were woefully ill-prepared for the scale of growth at the beginning of the lockdown.

This didn’t make a great impression on people attempting to buy groceries online for the first time. Gradually, however, many stores got their online acts together.

The result is that, during March, many new shoppers developed a taste for home food deliveries and for many other products  – and the concern is that many may never go back.

Online household goods spending was up 51.8% compared with March 2019, and online department store sales were up 47% compared with February 2020, before lockdown started.

In short, e-commerce recorded its highest recorded proportions of overall sales in all retail sectors ever, except non-store retailing, where it bagged a ‘mere’ 82.4% of the overall market.

Online-only is strongest retail performance

It’s no coincidence that one of the strongest reported retail performances of recent days has been by online-only fashion retailer Boohoo, which has recently added former High Street brands Karen Millen and Coast to its portfolio.

Additionally, the announcement yesterday (23 April) of the Laura Ashley brand’s partial rescue from administration is largely based around a plan to push the brand name online.

To stand any chance of fighting back, it’s vital that remaining town centre stores embrace ideas such as BOPUS – buy online, pick up in store – to tempt footfall back into physical shops.

They must also ensure shoppers are rewarded by offering a great experience, with knowledgeable staff and a range of amenities.

The High Street could become a ghost town by 2030, with e-commerce accounting for 40% of all retail sales and sucking the life from many of our town centres. Bracknell’s unloved town centre, including Broadway (pictured), was hit hard by the rise of e-commerce. It is now being replaced by a new £240m centre including restaurants and homes in a bid to win shoppers back

Meteor striking our town centres

Today’s figures are a meteor striking our town centres, and only the most agile and responsive stores, with a clear online strategy, are likely to survive the impact of COVID-19.

And it’s not just lumbering, giant brands facing extinction; it’s hard to believe, but there are still many local specialist shops with no online presence whatsoever.

March’s sales forecast figures should prove a final wake-up call to them.

With Britain’s couriers still picking up from businesses and warehouses nationwide, shipping products directly to customers is just as easy as it ever has been for specialist retailers.

More information: ParcelHero has updated its guide on how retailers can compare and contrast carriers prices and services

About the author

David Jinks MILT is Head of Consumer Research and Public Relations for the international parcel broker ParcelHero.

He appears regularly on national radio and press discussing the impact of e-commerce, the potential consequences of Brexit for exporters, and other assorted subjects from drones to music festival logistics.

He also presents masterclasses and webinars for ParcelHero and the Government’s ‘Exporting is GREAT’ initiative.

He has clocked up over 20 years’ experience as a transport journalist, and for many years was the Publisher of The Chartered Institute of Logistics & Transport’s Logistics & Transport Focus magazine.

During his career, he has also been hit by a professional boxer, had a TV studio set collapse around him and survived a witch’s curse!

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