EDITORIAL Challenging common assumptions about how retail is changing

In today’s InternetRetailing newsletter, we’re particularly interested by two stories that challenge some common assumptions about the way retail works.

Assumption one is that customers are buying more online, and that they do so at the expense of shops. Interesting new analysis from the ONS suggests that online growth is powered primarily by retailers that don’t have stores, rather than those that do. The only fall in overall store sales that it’s detected between 2008 and 2017 has been in the household goods sector – by 0.1%.v

At the same time, multichannel retailers such as Moss Bros saw footfall plummet over a hot, World Cup summer while online sales grew. For its particular audience, shopping from their phone while watching the match was perhaps more enticing than a trip to the high street as the mercury climbed. But its in-store presence, with its Tailor Me customised suit service, may attract those same shoppers at a different time. Both are important for the business, but the use of both may well fluctuate. 

Assumption two is that high street retailers make more money from the goods they sell direct to their customers, rather than the goods they sell via third-party retail partners. But French Connection this week showed wholesale revenue overtaking its retail revenue in the first half of its latest financial year.  

All these stories underline how important it is to plan strategies that reflect the demands of shoppers who are keen to buy in the way that suits them. In today’s newsletter we also report on how Screwfix is proving a model for the Kingfisher Group’s strategy and what lessons can be found in that strategy.