The news this week is dominated by the sudden and dramatic drop in footfall, the stalling of online fashion buying and the general air that consumers are seriously tightening their belts as the coronavirus crisis continues. However, this does not spell the end of the line for retail, far from it.
Much as the government puts out the daily death toll from the virus that paints a dark picture of where we are, these figures all point to what has already happened, not what is happening and where that leaves us.
Fall in footfall, massive drops in consumer spending and plummeting online and in-store sales across March are hardly a surprise. The first part of March was looking good. Momentum had been created in February and, for many retailers, things were looking up.
The lockdown may well have put a kink in that gallop, but it is just that: a kink. We are in an unprecedented situation, but as things stabilise on the health front (something that will become clear from the level of infections, not the daily death toll), so too will what is going to happen to retail. The people will come back and they will want there to be retailers to come back to – not just grocery chains, but all retailers.
Currently, while fast fashion is taking a hit, there are many success stories: gardening, DIY and home, nursery and food are all doing quite well considering. No, they aren’t booming, but they are hanging in there – which is what they need to do.
An interesting bell weather is the re-opening of Next’s and Quiz’s websites. Both clearly see that there is nascent demand out there and so are tentatively trying to make that work.
I say ‘nascent demand’; Next’s newly reopened website was in fact shut again two hours after restarting as it had the reached the daily self-imposed order limit… there is clearly a demand.
Likewise, those that can sell things that people want right now while stuck at home can keep the fires burning. Soon – a matter of weeks – things will change again and we shall see other sectors start to get some attention.
We find ourselves, both as the human race and as retailers, in a difficult and unusual time, but we will come out the other end. We will be changed by it, as will the retail landscape, but it will survive and online is set to thrive.
In fact, a survey commissioned by global commerce services company PFS to look at changes in consumer online purchasing behaviour, as well as their perceptions and expectations of brands around the pandemic finds that three in five (60%) consumers have purchased more goods since the lockdown began, than they did before, with 53% having shopped more online.
More than three quarters (77%) of these went on to say that they expect they will continue to purchase online more once the lockdown is over – indicating a potentially irreversible change in consumer purchasing behaviour.
We have seen many similar reports over the past couple of weeks, but it is set to be the new normal. Even the hard figures that show sales dropping are showing that online is not dropping as fast. The changing shape of retail is still very much in flux as we approach week four of lockdown.