This week’s announcement that the UK is effectively in lockdown, with all shops bar the essentials closed, came as no surprise to anyone – but that doesn’t diminish the impact this is going to have on an already beleaguered High Street.
Pre-Corona, bricks and mortar retailers were struggling: footfall was dropping and ground rents and rates were hammering them harder still. As the viral contagion spreads across the world, government may have removed those financial hurdles, but it is too late. Many are now closing their doors to aid social distancing, however many may never open them again.
The Centre for Retail Research, which has been forecasting retail trends over the past two decades, paints a gloomy picture. It believes that thousands of stores that have shut up for the foreseeable, are dead. In fact, it forecast that, by the end of the year, a total of 20,620 retail stores will have pulled down their shutters for the final time, up by a whopping 4,547 on 2019.
Of course, even as we languish at home staring out the window, we are still shopping – but the shift to online which was creeping along is now reaching into every strata of society – and many of these converts to online, from getting their groceries to buying everything else are not going to be going back to how they were when this is all over.
Analysts at Mckinsey believe that ecommerce is going to go from 20 to 40% of retail over the next few months and is unlikely to go back. Much of this has been heading to mobile too, so even the face of ecommerce is changing with the change in our circumstances.
Of course, people will return to the shops when they are allowed to – it will be a relief to do something different – but overall, the nail is in the coffin.
It seems glib to say that now is the time to really take a long hard look at how retailers operate, but I am afraid it is true. The global economy is going to be decimated by this pandemic and that will have massive impact. However, it will bounce back, but not to the world it was before.
This is, literally, an epoch-defining event: we will look at BC and AC – before and after Corona – as different eras, when things step change. Part of this change is how shoppers went digital, how they also went mobile and how they delivery drivers, shelf-stackers and checkout assistants joined doctors and nurses as the true heroes of our society.
Retailers need to look at how to make their shops, when they open, a true part of an omni-channel whole. They will also have to look at holistically marketing and informing people – with video, with push messaging, with social – and they will have to be part of what we all long for now, a renaissance in togetherness and not being so wasteful.
How retail will look after this crisis is still up in the air, but that is part of the fun: you can shape this now. You need to work on how to cope with the Corona conditions, but there needs to also be an eye to where we go next, AC.