On June 15 all non-essential retail stores within the UK will once more be allowed to open their doors, subject to strict regulations.

We estimate the lockdown, and the closures of non-essential stores will have cost the retail sector some £21.7 billion between March and June 2020, and with this period passing the biggest hit to the sector in 2020 will pass. Of course trade will not snap back to ‘normal’ immediately and store-based trade will be significantly impacted throughout 2020.

There is demand for in-store shopping to resume

A positive for the physical retail sector is that there is some demand for in-store shopping to return. When asked during the middle of lockdown what they were most looking forward to once social distancing measures were relaxed we found just under one-in-five consumers said they were looking forward to a day out shopping.

Whilst stores will open with strict social distancing measures in place, this does give an indication that there is some underlying demand for stores to reopen. In particular we found slightly more from female consumers (22%) compared to male consumers (22%), among those aged 25-34 (21%), those in lower socio-economic groups (DE – 24%) and those with children, particularly those aged 5-11 (25%).

What is notable is that these generations are in general the most frequent visitors to physical shopping locations, and those that are more likely to visit for social reasons (see: Shopping Locations – UK, July 2019).

At the time of writing, meeting venues are limited and guidelines prevent anything more than garden visitation so consumers will look to venues that can facilitate social meets – with physical shopping locations an obvious destination. This will be particularly true in urban areas, where personal outdoor space is limited.

However when looking at those other areas that consumers are looking forward to doing that come before a day out shopping, such as going out for a meal or going out for a drink, it is also clear that whilst shopping destinations may see footfall return due to the excitement for store-reopening, for this to be sustained the full mix of attractions within shopping areas must too be allowed to re-open.

Figure 1: What consumers are looking forward to when social distancing measures are eased, 7-14 May 2020
Base: 1,000 internet users aged 16+

“What are you most looking forward to doing once the current social distancing measures are relaxed?”

[graphic: image 1]
Source: Lightspeed/Mintel

However we know footfall will still be significantly impacted

Whilst above we outlined conditions which could see a significant proportion of ‘normal’ footfall return to shopping locations, we need to make the distinction between visits to shopping locations and store visits. Whilst we expect town centres, shopping centres and other such shopping locations to benefit from the ‘social’ element of visit in the short-to-medium term, we also expect in-store footfall to be significantly impacted during this same period.

This is due to prevailing consumer concerns regarding spending time in-store, and the reality of socially-distanced shopping. On the latter point, queues necessarily limit flow in-store and will naturally lead to lower footfall throughout the day.

On the former point our tracker data shows there is still significant concern about time-spent in-store. Currently 47% of consumers are limiting their time in-store, and this has been at a consistent level within our data since April. Of course the missions this data relates to, namely grocery shopping, tend to be non-discretionary and less experientially driven. So we may see this ease a little when more ‘exciting’ store experiences become available, however our tracker data in Europe where non-essential stores have already re-opened suggests this concern regarding being in-store persists even when all stores are open (see: Lessons from Other Regions).

This is important as for many non-food retailers, dwell time in-store is crucial to converting footfall to sales. This is particularly true for categories such as fashion where browsing remains key, if consumers are trying to limit time in-store this impact on browsing and sales.

Figure 2: Time spent in store, April-May 2020
Base: 1,000 internet users aged 16+

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

[graphic: image 2]
Source: Lightspeed/Mintel

Location will be crucial

During the pandemic we have naturally seen consumers spend more time in their local areas, and in terms of at least grocery shopping, shopping behaviours become more confined to the immediate area.

This is reflected within our data with consistently over a quarter of shoppers saying they are shopping more from local businesses. Notably the easing of movement restrictions in mid-May has not impacted this trend, highlighting that it is not simply about being confined to the local area – it is a trend also being driven by heightened awareness of local communities and the need to support local businesses.

So we expect localised shopping to continue to see an uptick in the short-to-medium term. In particular this trend will continue to be driven by the closure of workplaces as without commuting, particularly into urban areas, day-to-day movement is reduced and footfall into hubs will be down.

However as we outlined above shopping areas also pose a social aspect, potentially more than ever due to restrictions on where consumers can congregate. We would then expect major shopping centres to re-attract footfall quicker than other areas, particularly from July with the other elements (leisure/foodservice) beginning to reopen, and other areas where socially distancing is made easier due wider open spaces, to benefit.

Indeed notably in both the BRC and Springboard’s footfall trackers show that in April retail park footfall was less affected than other locations. This is logical given such areas have a higher density of larger ‘essential’ stores (Grocery, DIY, Non-food discounters etc) but also such locations have more room to manage social distancing and more scope for visitors to travel via personal transport. So we would expect retail parks in particular to recover more quickly in the short-to-medium term.

Figure 3: Changes in local shopping, 16th April-3rd 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?”

[graphic: image 3]
Source: Lightspeed/Mintel

Key to ensuring impact on footfall is limited is reassuring consumers

Whilst footfall/dwell time in-store may be naturally limited in the short-to-medium term, there are certainly measures that retailers can implement to minimise this impact. The most basic element retailers must manage is customer flow for social distancing. This will naturally limit the number of customers in-store at one time, and irrespective of store size mean that footfall is more limited.

The grocery sector has already paved the way in instigating queuing prior to store entry. Automating the flow, as Aldi has looked to do with its traffic light system, is one solution and one that can alleviate the need for multiple staff to be engaged to manage queuing. Morrisons was the first to introduce ‘Speedy Shopping’ lanes to its queuing system, designed to help those shoppers who only have smaller basket needs.

This thinking touches on an important point, the need for managing different flows for different missions. For example if click-and-collect grows in the way we expect, those customers are unlikely to be willing to wait in long queues alongside browsers as this defeats the object of the convenience that click-and-collect serves.

This idea is not easy to put into practice, particularly at larger stores where the numbers within queues can be substantial, as seen in May with Ikea. However without measures in place this is going to negatively impact consumer’s perception of the shopping experience. Shopping by-appointment, with pre-booked slots seems a logical solution with some in the luxury market already embracing this.

Figure 4: Aldi – automated ‘traffic light’ store entrance, May 2020
[graphic: image 4]
Source: Aldi

Hygiene a crucial concern

COVID-19 has focused consumer’s attention on personal hygiene. This is having a significant impact on retail and the functionality of stores. Prior to being recommended by the UK Government we found that 17% of consumers said they were wearing masks in public (9th-16th April 2020) and whilst at the time of writing it is not compulsory to wear masks in-store like it is in other European nations many retailers are suggesting customers do so.

Figure 5: Co-op face covering sign, May 2020
[graphic: image 5]
Source: Mintel

On a product level there are significant concerns around hygiene. The data below from Mintel’s tracker highlights this, from the 55% of consumers who are concerned about who has touched products prior to them to the 38% who are disinfecting shopping when they come home – there is far more scrutiny being placed on products and packaging.

In the non-food sector, where for many categories part of the attraction of store-based products is seeing and interacting with products ahead of buying, this poses significant issues. For fashion in particular, where the trying on of products is key, this is a major issue. At present the Government is recommending changing rooms remain closed, but in footwear we have seen the likes of Office say that they will put aside all tried on pairs of shoes for 24 hours. On a practical level this will limit store-operations, for smaller footwear stores they may only stock a couple of sizes of each style.

The disinfecting of products will be crucial. We have already seen a number of retailers experiment with and invest in UV-light to quickly disinfect products, although to equip all stores with such technology is a costly venture. Beauty will be significantly impacted as product testing will be drastically changed, with retailers having to move to single-use testers, at additional cost, or rule out testing completely, as Boots has done.

Figure 6: COVID-19 behaviours when shopping for groceries, 28th May – 3rd June 2020
Base: 1,000 internet users aged 16+

“Thinking about grocery shopping and product packaging, do the following statements apply to you?”

[graphic: image 6]
Source: Lightspeed/Mintel

A further push toward a ‘cash-less’ future

During the crisis there has been a significant increase in the number of consumers looking to limit their interactions with cash. This will put more focus on card/contactless payments, which will have little impact at store level but may hinder trade in more informal retail settings, such as markets.

However the bigger opportunity here for retailers is to use this aversion to cash as a way to drive engagement with their own scanning/payment solutions. We have seen this in the grocery sector where most are pushing their ‘scan-and-go’ solutions as a more hygienic and faster way to shop, but there is the opportunity to do this across the sector.

Why this matters is that if this is the step change in ‘personal checkout’ that had been building pre-COVID-19 this will mean less reliance on staff at checkouts, freeing them up to serve in other roles, and also opens up a significant data capture portal for retailers.

Figure 7: Attitudes towards cash use, 16th April – 3rd 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?”

[graphic: image 7]
Source: Lightspeed/Mintel
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