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EDITORIAL How UK retailers are responding in a market hit hard by Covid-19 

Image: Shutterstock

Image: Shutterstock

In today’s InternetRetailing newsletter we report as the latest figures show just how hard UK retail has been hit by the coronavirus lockdown. Overall sales across all channels have fallen sharply for the second month in a row, despite a 60% rise in online sales, as measured by the BRC.

Figures from Barclaycard show where shoppers are spending – and where they are not. All eyes are now on June 15, the date when non-essential shops can start to reopen, according to government guidance – as long as the infection rate is under control. Footfall figures from Springboard yesterday predicted a pent-up demand to return to high street shops – but warned that the retailers that would benefit would be those that could manage social distancing most effectively. 

It’s clear that reopening can’t solve all of the problems that retail brands are experiencing as a result of Covid-19. Mulberry yesterday said it would consult on cutting a quarter of its global workforce because even though it is selling strongly online, those digital sales fall well short of compensating for its overall loss of sales. It says it is downsizing its workforce to meet current levels of market demand. The news comes days after the UK arm of Victoria’s Secret went into administration, putting 25 UK stores and 800 jobs at risk. Customers will still be able to shop from the brand online. These retailers are unlikely to be alone in a market that went into the pandemic expecting to lose thousands of store jobs as shoppers spend less while also shifting their spending online. Those trends have only been intensified by Covid-19, and are also reflected in this week’s news that AO is expanding its distribution capacity as “five years of channel shift from stores to online condensed into five weeks” in the words of AO Logistics’ David Ashwell.

Many brands, of course, are already trading online very successfully. Europe’s Top500 brands are named in the new RetailX Brand Index 2020 report, published in association with Tealium and now available online, where researchers analyse the tools and approaches that successful brands use as they trade online. Today we report on how retail clothing brand Sosander has responded to the pandemic and seen orders grow by 44% and revenue by 62%. 

In today’s guest comment, Tom Williams of Maginus argues that British shoppers’ love of the queue could translate online.

Image: Shutterstock

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