In the face of an ongoing health crisis, which has halted the operation of many businesses and drove hundreds of millions of people to stay indoors, British retail sales are plummeting at a record pace. In fact, figures from the British National Statistics Office showed that sales sank by more than 18%.
However, while there is no telling when the pandemic will completely end, things seem to finally be looking up for UK retailers, with all non-essential shops being allowed to reopen starting 15th June, and online spending continuously increasing by the day.
Growing online spending amidst the lockdown
Even before the pandemic broke out, online retailing had long been predicted to experience a steady increase in the coming years. According to the UK Online Retailing 2019-2024 report that was released earlier this year, as British shoppers continue to shift away from visiting stores and gravitate towards digital shopping channels, UK online spending is set to reach £75 billion — rising by 30.4%.
During these trying times, online spending has thrived even more, with Brits spending a record £1.2 billion online by buying groceries. Market researcher Nielsen said that over the course of the UK lockdown, 7.9 million British households placed an online grocery order, which bumped the overall UK grocery sales up by 13% year-on-year. On the other hand, the fashion industry is also starting to show gradual signs of recovery, with online fashion checkouts exhibiting a 115% year-on-year increase last month, as per an article by Internet Retailing.
Taking advantage of rising online spending
While the spike in online spending can be directly attributed to the current situation of the world, other factors – such as internet activity, convenience, the retailers’ improved delivery capacity, price, and the availability of product information on the stores’ websites – have all played a crucial role in making the transition to online shopping seamless.
Different payment methods such as credit cards and contactless payments have gained popularity in recent years, likewise contributing to making online shopping easier. In order to bounce back, it would be in the best interest of UK retailers to improve their eCommerce presence by exploring new ways to sell inventory and getting on different online channels where they can advertise their products. Now is the right time for retailers who have been lagging behind in the eCommerce space to accelerate their digital transformation efforts and come up with marketing plans that will shift as much foot traffic as possible to their websites.
It would also be a good idea for retailers to revamp payment methods since cards and contactless options are now being used for more than half of the payments across the UK. Based on a report released by banking trade body UK Finance, card payments accounted for 51% of all payments in the country, while the number of contactless payments across debit and credit cards rose by 16%.
With online shopping and contactless payment methods rapidly becoming the new norm for many countries around the world, including the UK, FIS Global explains that streamlining cross-channel retail experiences will be the key to thriving in the future. Going forward to accepting multiple currencies will not only be beneficial for stores that are planning to expand globally. Neat Commerce emphasized that it will also help stores avoid hidden international transfer fees, limit lost funds in currency conversion, and most importantly, introduce a better experience for customers.
As the country continues to ease lockdown measures and non-essential stores start to reopen, the online shopping habits British shoppers developed are likely to stay and dictate the future of retail.