In today’s InternetRetailing newsletter, we start our Peak 2020 rolling reporting, in which we’ll focus on how Top500 retailers are handling peak trading with the added complication of a lockdown that means non-essential retail stores are now closed. Today we cover the launch, online and social media, of this year’s John Lewis advert, virtual Christmas shopping queues at Tesco, and reflect on findings from Capgemini and IMRG on how retailers are responding to changing shopper behaviour.
We report on how both Farfetch and Burberry are dealing with a rise in online shopping and an appetite for luxury goods that is increasing sales but isn’t always benefiting the bottom line. The shift online has inspired innovation – from Farfetch’s virtual sneaker try-on, to Burberry’s runway show being live-streamed on Twitch – but as yet that’s not following through to increased profits. As we’ve said many times of the years, it seems stores – many of which are now closed under European and UK lockdown restrictions – will need to be fully involved if a digital future is to be more profitable for retailers.
Beyond the luxury sector, WHSmith is also seeing online sales rise fast – sales on its own website rose by 240% in the second half of its financial year. But the retailer is now considering closing 25 shops – depending on how its landlords respond – as it looks to adapt to a new trading environment that has badly hit both its high street and its larger estate of travel shops.
UK GDP rebounded by a record level in the third quarter of this year – admittedly from a record second-quarter dip – and it seems that the shift online was in part responsible. That said, overall GDP is still well below where it was a year ago, and may be hit again as a result of the current lockdown.
In today’s guest comment, Brian Ruwadi of McKinsey suggests some top tips for winning back customer this loyalty in peak 2020.