After a year of on-off restrictions, the pandemic has been challenging for many retailers and landlords, but it has also had a positive and progressive impact on trends within the industry. Lockdown restrictions have increased demand for a more localised retail offer as consumer behaviours continue to change.
And consumers have changed - one of the main shifts in spending habits since Covid being the switch to more local shopping streets and retail parks.
At Brightpearl, our own consumer research indicates that 63% of consumers will buy from more locally based businesses over the next 12 months, while 60% plan to increase shopping with independent high street retailers, illustrating that the trend towards localism is here to stay, which is likely to continue to be reinforced by our own remote working habits, which are set to remain for the foreseeable future.
The high street spending surge that has happened since retail reopened on 12 April, with shoppers queuing around the block for established high street brands such as Primark and TK Maxx, is a false dawn, and long-term footfall is set to continue to plummet - with a predicted 67% drop in city centre footfall over the next year, according to our study.
The story is different for retail parks which have proved to be resilient destinations during the pandemic as shoppers felt safer driving to such stores which tend to be more spacious, and this aligns with our research findings which reveal 41% of shoppers also plan to increase their use Of Click & Collect services over the next year.
High Street Reality Check
Through this lens it’s clear that retailers should embrace localism, and many are already making plans to move stores to high street locations with increasingly strong foot traffic. In our research, almost one-in-five said they plan to move stores out of major city centres and into local high streets within the next 12 months.
Renewed support for local stores is a positive - but it’s also essential. Customers are relocating to the suburbs and rural towns - or, increasingly, they are moving online.
Our study shows that 43% of consumers are now buying things online more than normal, with more than 6 in 10 shoppers (65%) expected to increase online purchasing over the next 12 months, With insights sure to concern high street retailers, almost than half of shoppers (45%) are now buying things online that they only previously bought in-store.
This should be a reality check for retailers emboldened by this week’s buzzing high street activity - the future of shopping is online or local. Retailers have to respond quickly to these covid-inspired changes, and do so with greater levels of innovation.
Rise of Localism
We could soon see a future with more popup stores or short-term flexible leasing in local high streets as they become high foot-traffic areas, out of town or local stores acting as fulfillment centers for Click & Collect collect orders, or stores sharing space in small metro outlets in these new high traffic areas. These changes would adapt to consumer preferences by creating a more relevant, localised offer of independent and established retailers, so residents do not need to travel to get what they want.
At Brightpearl, many companies we work with are already looking into adding more delivery options which support customers’ increased preference for local shopping - a strategy that makes a lot of sense. In a world where consumers will almost certainly want the option to pick up their online shopping from a local collection point, online retailers should consider adding local Click & Collect points to their delivery offering to capitalise on local footfall and increase revenues.
This is no easy feat though, and retailers and brands offering local collection, potentially at hundreds of locations across the country, will need an accurate picture of inventory so that shoppers can select the most convenient location and not be disappointed when they arrive to pick up their product. To pull off this service successfully, companies will need systems underpinning their retail operations that enable this type of advanced fulfillment - alongside flexibility in how orders are fulfilled, and the ability to accurately manage multi-location inventory management.
Some brands, especially those with a strong high street presence, may be hesitant to make changes, but the flurry of shop closures and the growing list of retailers shuttering stores due to coronavirus, should spur firms into action.
Furthermore, only a quarter of Brits claim they will continue to shop as they did before the crisis - indicating that the vast majority plan to retain their new buying behaviours embedded throughout the pandemic, even when things return to normal.
The High Street surge is temporary - brands cannot be lulled into inaction as a result of it, and, instead, they must acknowledge the changing landscape and be prepared to adapt to this once in a generation retail transformation - those that do will ensure their long-term success.
Nick Shaw, chief revenue officer at Brightpearl