Over the course of the last month, the COVID-19 pandemic has continued to cause disruptions in the lives of UK shoppers and to affect consumer behaviour in various ways. While some countries have already reopened non-essential shops and are experiencing a gradual return to ‘normality’, in the UK, a broader range of retailers will only reopen from 15th June. Those include clothes shops, toy stores, electronics retailers, booksellers, indoor markets, tailors, auction houses and photography studios.

We explore the impact of the pandemic in terms of retail sales across this report, and in more detail within the UK Retail Sales – Impact of COVID-19 section.

According to our consumer research, the level of concern among consumers towards the risk of infection has been gradually decreasing over the past four weeks, after a slight increase during the second week of May 2020.

While those claiming to be worried about being exposed to the virus in early to mid-April reached nearly two thirds of the population (63%), the proportion now encompasses little under half (48%) of consumers in the UK. The figure is comparable to France (51%) and Italy (53%) but above Germany (37%) and considerably below Spain (72%).

However, as lockdown restrictions continue to ease across the UK, health experts become increasingly concerned about the likelihood of a second wave of COVID-19 cases if the recommended social distancing guidelines fail to guarantee the safety of consumers and especially of retail staff. What happens over the upcoming weeks will therefore be crucial to determine whether the pandemic will have a second – and potentially further damaging – impact on retail and the economy.

Figure 1: Those worried about the risk of being exposed to the coronavirus, March-June 2020

Base: 1,000 internet users aged 16+

“How worried are you about the risk of being exposed to the coronavirus?”

Wave 3: 26th March - 1st April 2020

Wave 4: 2nd April - 9th April 2020

Wave 5: 9th-16th April 2020

Wave 6: 16th April - 23rd April 2020

Wave 7: 23rd April - 30th April 2020

Wave 8: 30th April - 7th May 2020

Wave 9: 7th May - 14th May 2020

Wave 10: 14th May - 21st May 2020

Wave 11: 21st May 2020- 28th May 2020

Wave 12: 28th May 2020- 3rd June 2020

Source: Lightspeed/Mintel

When we look at the demographics, there was an interesting shift in the level of concern over the past two months. In the beginning of April, and all the way until mid to late-May 2020, the proportion of those concerned about potentially getting infected by COVID-19 was peaking for consumers aged 35-44. Between the end of May and early June 2020, this peak shifted towards the elderly, currently being highest for those aged 55 or more.

The initial peak among middle-aged shoppers results from consumers in this age group most likely having young children that are highly dependent on them. In other words, contracting the virus would not only affect them but could directly impact their ability to look after their kids.

As lockdown eases, the fear of infection slowly subsided among younger consumers, and even though the risk of infection remains high for all age groups, and the peak shifted towards the elderly. This is fairly unsurprising, considering that older consumers are more vulnerable to the effects of COVID-19.

We think demand will be gradually resumed for most sectors in the medium to long-term. However, consumers will likely continue to spend more time at home even as lockdown measures are lifted, further supporting the increase in online demand. As a result, we have seen retailers across different sectors accelerating their shift to ecommerce, strengthening their platforms and creating digital and/or remote versions for their services.

Between the mid-April and the first week of June 2020, the proportion of those who claim to be shopping more online has continued to increase, rising about five percentage points in the UK.

Figure 3: Those claiming to have increased the amount of shopping they do online, April-June 2020

Base: 1,000 internet users aged 16+

“Since the start of the COVID-19/coronavirus outbreak, which of the following apply to you?”

Wave 6: 16th April - 23rd April 2020

Wave 8: 30th April - 7th May 2020

Wave 10: 14th May - 21st May 2020

Wave 12: 28th May 2020- 3rd June 2020

Source: Lightspeed/Mintel

Unsurprisingly, online shopping remains highest among younger consumers with nearly half of those aged 16-24 (48%) claiming to have increased the amount of shopping they do online versus little over one third (34%) of those aged 55 or more. There is clearly an opportunity for retailers to increase their online penetration among older shoppers, for example by addressing the main challenges elderly consumers face when using ecommerce.

We think retailers could benefit tremendously from encouraging older consumers to use ecommerce and home delivery services by better communicating the benefits these can offer, particularly in terms of convenience. Retailers should highlight the ease with which online shoppers can refer to previous orders, how online shopping can help with budget management, not to mention the safety element of avoiding crowded spaces and the risk of contagion. It also eliminates the effort of queuing, carrying the shopping around and loading products into their car, which can be a particular burden to those aged 55 or more.

Figure 4: Those claiming to have increased the amount of shopping they do online, April-June 2020

Base: 1,000 internet users aged 16+

“Since the start of the COVID-19/coronavirus outbreak, which of the following apply to you?”

Wave 6: 16th April - 23rd April 2020

Wave 8: 30th April - 7th May 2020

Wave 10: 14th May - 21st May 2020

Wave 12: 28th May 2020- 3rd June 2020

Source: Lightspeed/Mintel

Independently of how much they have increased the amount of shopping done online, the proportion of consumers spending less time in-store remains high and fairly unchanged, representing around half of the population. Spending less time in-store will have a negative impact on sales, especially on impulse buy, and therefore yet another reason for retailers to increase their online sales. Social media and other digital tools can be highly effective to promote online shopping, especially among younger shoppers, and if retailers can increase ecommerce activity among older shoppers as well, this could partly offset the decrease in in-store sales they are bound to experience.

The COVID-19 pandemic has also been affecting how consumers pay for their purchasing, leading to a decrease in the use of cash payments. While this trend has slightly subsided in the beginning of June 2020, our research shows that it remains high (48%), especially among women (55%).

Figure 6: Those claiming to be trying to avoid using cash where possible, April-June 2020

Base: 1,000 internet users aged 16+

“Since the start of the COVID-19/coronavirus outbreak, which of the following apply to you?”

Wave 6: 16th April - 23rd April 2020

Wave 8: 30th April - 7th May 2020

Wave 10: 14th May - 21st May 2020

Wave 12: 28th May 2020- 3rd June 2020

Source: Lightspeed/Mintel

In terms of demographics, our research shows that older shoppers seem particularly prone to avoid making cash payments, especially from mid-May 2020. In fact, the gap between those aged 16-24 and those aged 55+ who are avoiding using cash increased from 3 percentage points to 16 percentage points over the past six weeks. This is likely due to younger consumers having recently increased their spending outside of the home, both shopping in-store and with travel to visit friends and family as the lockdown measures were eased in the UK.

Figure 7: Those claiming to be trying to avoid using cash where possible, by age group, April-June 2020

Base: 1,000 internet users aged 16+

“Since the start of the COVID-19/coronavirus outbreak, which of the following apply to you?”

Wave 6: 16th April - 23rd April 2020

Wave 8: 30th April - 7th May 2020

Wave 10: 14th May - 21st May 2020

Wave 12: 28th May 2020- 3rd June 2020

Source: Lightspeed/Mintel

Examples like the initiative by Italian grocer Coop Italia, dubbed ‘Kiosk Coop’ and created to help consumers remain physically distant when shopping during the coronavirus crisis, while avoiding cash payments. The devices allow customers to pay for their orders online and then pick up their orders in specific collection areas. Alternatively, the technology allows for a click-and-collect service, where customers check in to have orders placed straight into the boot of their car.

When we asked consumers how they expect the COVID-19 pandemic to affect the UK economy, many have claimed to have a strongly pessimistic outlook for the future. Our consumer research for the UK showed us that, contrary to the other four leading European economies, the coronavirus crisis is expected to have the strongest impact on economic growth (45%), not on unemployment (40%).

Nevertheless, unemployment is expected to be the second most affected factor, followed by the cost of living and the price of property. While the level of pessimism generally increases with age, it peaks for different factors across the age groups. Consumers aged 55 or more seem the most pessimistic about unemployment, those aged 45-54 towards economic growth and shoppers aged 35-44 are the most pessimistic towards the impact of the pandemic on the cost of living; probably because this age group is the most likely to have young children as their dependents.

Figure 9: Those claiming to have an extremely negative outlook on the following factors, 28th May-3rd June 2020

Base: 1,000 internet users aged 16+

“What impact do you think the COVID-19 outbreak will have on the following factors?”

Source: Lightspeed/Mintel

In any case, it will be interesting to see how the sentiments towards the future of the economy will progress in the upcoming months, and whether the gradual return to a semblance of ‘normality’ will affect how consumers feel towards the future.