Lockdown has sent economies around the world into free-fall but there is some good news beginning to emerge about offline retail, as shoppers return to the High Street.
In fact in a recent statistic released by one retailer in the UK ‘Vape & Juice’:
It’s been better than expected, as we have seen our offline stores return to 80% of their pre-lockdown revenues. It’s not the full rebound, but we are happy where things have gotten to so soon.Fred Wild Head of Operations – Vapeandjuice.co.uk
It was an interesting statement so we took the time to look at whether this is isolated or down to some key actions taken.
Shoppers return to the High Street – Post Lockdown?
According to Reuters, High Street retail footfall was down 63% year on year for the month of June in 2020, which was up still by 19% on May. The effects of this on retailers, large and small may not still be factored in fully, but the signs of a recovery are visible.
It’s no secret that online businesses scored big the moment a national lockdown was declared, in fact they won in every part of the world.
Reports of traffic spikes, internet sites collapsing, some including Ocado the UK online grocer, closed their site for a few days. Internet retail was forced upon shoppers who had never even used it before.
But the question remained, would those shoppers return to the High Street when the worst blew over. (It’s blown over right?)
On the face of it, it appears that many who had seen the light of Amazon and co, wanted to get back to normal. Popping into a brick and mortar store was one way of demonstrating that.
Can offline retailers cope with anything less than 100% footfall?
Having worked in the retail sector myself, I’m acutely aware of the margins. A drop of 20% in footfall IS going to lead to many more store closures and redundancies.
According to Investopedia, the average net profit margin of most retailers is between 0.5 and 4.5%. Take 20% away from the revenues and it spells catastrophe.
So is it still bad news for retail?
No, not by a long shot.
Certainly not if your offline is complemented by work to develop online sales. The smallest independent store can compete with pretty much any retailer but Amazon when we talk e-commerce. (Ironically by sometimes using Amazon’s infrastructure)
And this is what we have seen happen. In the UK according to GoDaddy, 20% of business’s first ever online sale happened during the lockdown. It’s a statistic that has seen the name Shopify become more and more prevalent in the news, as they were one of the ports of call for many a start-up:
Boom in online shopping fuels rally in Shopify Stock. Stock has climbed 82% from recent low, one of market’s biggest winners during coronavirus pandemicWall Street Journal
Maybe your business is one of those that has jumped on Shopify and now you’re getting to grips with their system. If you want to read something that can help your sales online – head below next:
Going back to that original ‘shoppers return to the High Street’ statistic from the directors at ‘Vapeandjuice.co.uk’, it appeared that one unique factor stood out, which is why their case is so interesting for this:
In February we sold part of our store estate to another national operator. Those stores that remained with us have rebounded. It’s no secret that the stores we let go have in places struggled. In fact, one of our competitors said, of all of their stores, the only one that’s doing better than pre-lockdown figures, is where our old flagship store was.
In addition, at least one more has been closed permanently. The difference here, particularly where some of the old shops still bear our name, is that we worked hard to take care of our customers online, in a way that others weren’t. Where we could hand deliver to ensure next day service levels, we did. Where we were out of stock, we called them up and not merely emailed their spam folders.
We treated online (we still do) the same as you would offline. An almost cult-like focus on customer service standards. We took care of them. Now they are taking care of us.
In the past, we had franchisees who didn’t want to mention the overall company website.
They thought it would hurt them. And that’s a problem with the wider franchise community. But if you don’t tell people there is a website, they aren’t not going to look online when every bloody shop in the high street is shut.
You lose them and you may lose them forever.
That mindset is what we changed internally, and it explains our bounce back
The rebirth of Secondary Retail Parades
One of the really pleasing aspects of the lockdown, (yes, there were some) is the revival of the local secondary parade of shops. Shoppers return to the High Street but also to your neighbourhood shops too.
Where once small grocery and general stores were being battered by out of town centres, the sheer convenience factor and the perception of ease and smaller queues, saw local shopkeepers near me getting a much need injection of attention.
I can’t speak for the entire country but my beliefs were supported when I came across this piece in ‘The Grocer’ reporting convenience store sales up over 40%.
Convenience stores raked in 47% of the £49bn spent on groceries, tobacco and general merchandise during the 16 weeks of lockdown as a result of changing consumer shopping habitsThe Grocer
Anecdotally, high streets still seem largely quiet -the concept of queuing and remembering your mask is a stress perhaps for many.
Having worked closely with one local retailer on a secondary parade to assist them in their SEO efforts, it’s been quite interesting to see how much opportunity still exists for offline retailers who want to trade electronically too.
The ability to leverage your access to customer service trained staff on your website’s webchat, or let people browse before committing instore actually improves conversion rates of your footfall and of course the online sales that a good human powered webchat offers.
Local stores can deliver locally same day too. If you want to hear our recent podcast on this topic, you can listen below
Can UK retailers withstand another lockdown?
It’s more likely than not, that another lockdown will occur toward the latter part of the year. The danger is when this happens. If it happens during November/December it could spell disaster for many who rely on the Christmas rush.
If shoppers return to the high street now, will some forget to prep for another dark turn?
Will Rishi throw another set of lifelines out and will it be enough?
But for those that have so far withstood this tough time, the solutions are there. If your business is not facing up to the threat of emerging online competition it isn’t too late to adapt. Helping out smaller businesses with their search marketing showed me something clearly. There are many sectors and retail niches that are wide open online.
The competition is low, the volumes of search are high.
The question is really: “Will you be the one to attack?”
For those that came to our piece, looking for hope, check out our podcast, it will show you all is not lost.
Thanks for reading and feel free to quote or cite this ‘Shoppers return to the High Street’ piece for any journalistic retail writing.
I’ll leave you with this quote from Sir David King, former Government Chief Scientific Advisor and founder of Independent SAGE, to get you motivated.
We will see the Government backing lockdowns and, yes, I do think this could happen nationally.Sir David King, Independent SAGE