Online sales rise at record rate as non-essential shops stayed closed during May lockdown: BDO

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UK online sales showed record growth during May 2020 – a month in which all non-essential shops were closed, new data suggests. Overall like-for-like sales fell by 18.3%, according to the BDO High Street Sales Tracker, covering the five weeks to May 31, as online sales grew by 129.5% compared to May 2019, and store sales were down by 87.1%. At the same time, footfall fell by close to 80% at both high streets and shopping centres. Retail park footfall was slightly better, recording a fall of 63.2% in the first week of the month and a fall of 48.9% in the final week.

Last May, stores sales had been down by 3.3%, online sale up by 19.8% and overall like-for-like sales grew by 2.2%. 

This May, homewares was the only category to show like-for-like growth, compared to last year. Sales were up by 22% as online shoppers spent 73.7% more – taking homewares as a category to its highest result yet recorded by BDO. 

However, both lifestyle (-30%) and fashion (-22.6%) sales continued to be low. 

In its commentary, BDO said that cash flow difficulties were now affecting most and supply chain issues were now “increasingly pressing”. It added: “Retailers now face the immense logistical task of reopening under strict guidelines and, in all likelihood, to significantly lower levels of footfall than usual as consumers cautiously return. Consumer confidence remains subdued as concern shifts to a prolonged economic recovery. Moreover, as retailers begin to re-open next month a significant portion of consumers are likely to continue favouring online channels for their shopping experience over coming months as the spectre of COVID-19 and the potential of a secondary spike remain. While the challenges are many, retailers must find opportunity amidst the turmoil by engaging consumers through their preferred channels.”

Commenting, Nigel Naylor-Smith, head of retail and hospitality at Fujitsu UK, said: “As ‘non-essential’ retailers across the country have been closed for the past few months, online sales were always going to rise with shoppers left with no other alternative. While some retailers suffered teething problems in adapting to an online-only model, key lessons will have been learned as businesses operated in the new normal.

“While those retailers that invested in omnichannel before the UK’s lockdown will undoubtedly be in the best position to bounce back from the current shockwave, long-term success will not just be defined by online channels. As stores begin to reopen with social distancing, retailers will have to think about ways they can turn their stores into experience-driven hubs; stores should be viewed as a platform for discovery, experience and interaction.

“Finding the best and most effective way to engage with customers over the coming months will be challenging for retailers, as people slowly return in-store come mid-June. But having the customer experience front and centre in any omnichannel strategy and understanding how consumers behave will be the key for retailers to thrive.”

Image: Adobe Stock

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