According to Mintel’s COVID-19 Tracker on average 41% of consumers say they have done additional online shopping due to COVID-19 since the outbreak began in the UK. This extreme growth in online retail use will, based on Mintel forecasts, see online sales grow by 42.3% in 2020, the fastest growth rate in the channel since 2009 (+28.5%).

This growth in online purchasing has been seen across all channels but is particularly true in grocery, with the number of consumers buying food and drink online growing from 43% to 56% between April and August 2020.

One of the biggest threats to the market in 2020 has been the potential for logistics networks to be overrun by the additional demand caused by COVID-19. Significant investment has had to be made to ensure the demand for home delivery can be met, as well as that the safety of staff and customers is protected. This investment should mean disruption is minimised during the second lockdown in England, but the pressure on networks will be acute as retailers have to pivot to fulfil more demand online during the busiest time of year for the retail sector.

There is significant demand for some of these COVID-19-related safety measures to become commonplace longer-term, with 76% of consumers saying they want contact-free deliveries to remain even when the peak of the pandemic has passed and 54% saying that COVID-19 has made them more critical of the hygiene standards of online orders.

Whilst greater scrutiny is being placed on online businesses, there is also greater appreciation for their role in the market following their efforts during COVID-19, with 86% of consumers saying the outbreak has given them more appreciation for delivery drivers/personnel. More than this with online retail to be given a long-term boost by COVID-19 behaviours, this will naturally bring opportunity for retailers in the online channel and for those businesses that are key to helping retailers fulfil this demand.

• The impact COVID-19 has had on consumer attitudes towards delivery and collection services, and the implication for these areas moving forward.

• The size of the market for collections, and the impact that COVID-19 has had on collection-based sales.

• Levels of online shopping pre- and post-pandemic, and the legacy impacts of these shifts.

• Methods used to receive products in the past year and the impact COVID-19 has had on use of delivery/collection services.

• The level of returns in the past year and how COVID-19 may influence this moving forward.

• Price-sensitivity, in particular around the cost of same-day deliveries.

• Brand perceptions of leading delivery companies within the UK.

This update on the impact that COVID-19 is having on the market was prepared on 10 November 2020.

The first COVID-19 cases were confirmed in the UK at the end of January, with a small number of cases in February. The government focused on the ‘contain’ stage of its strategy, with the country continuing to operate much as normal. As the case level rose, the government ordered the closure of non-essential stores on 20 March.

A wider lockdown requiring people to stay at home except for essential shopping, exercise and work ‘if absolutely necessary’ followed on 23 March. The Health Protections Regulations 2020 came into effect on 15 June allowing the reopening of all non-essential stores in England and the mandatory use of face coverings on public transport. Pubs, restaurants, hotels and hairdressers reopened on 4 July and beauty salons reopened on 13 July. The use of face coverings in shops and supermarkets became mandatory on 24 July.

On 21 September, the alert level was moved from 3 to 4, which means transmission is high or rising exponentially. New restrictions took effect from 24 September, including a 10pm curfew on pubs, restaurants and bars in England. On 23 September, the government announced that all shop staff must wear face coverings and people were advised to work from home if possible. On 14 October 2020, the government introduced a three-tier approach to local COVID Alert Levels in England, with local restrictions varying according to the government-defined tiers. 

On 23 October Wales entered a ‘firebreak’ lockdown, with all non-essential businesses closed until 9 November. On 2 November Scotland announced a new five-tier system, with tier four of this system requiring non-essential stores to close, although at the time of writing no area had been placed into this tier. On 5 November England was placed into a second lockdown, with no household mixing and non-essential stores closed. These measures will last until at least 2 December, although could be extended, either nationally or at local level, should infection rates not fall.

This Report is designed to give a broad overview of consumer attitudes towards and use of delivery, collection and returns methods resulting from online retail purchasing within the UK. This Report is primarily a consumer research-focused one, although market data is used to highlight key trends in the wider retail market.

Throughout the Report we talk in general terms about delivery, collection and returns. For the purpose of this Report they are defined as such:

Delivery is defined as an order that is delivered to a customer’s home, work, place of education or any other location that they have used as a traditional postal address.

Collection is used as a broad term to describe the numerous collection services offered in the UK retail sector. Broadly speaking collection orders can fall into one of three fulfilment methods:

• Click-and-collect in-store: This is where payment is taken online and the order is made available for collection at a retailer’s own store or via another retailer’s store through a partnership, eg through Amazon’s Hub scheme.

• Reserve-and-collect in-store: This is where no payment is taken at the point of purchase, rather the items are reserved to be collected and paid for in a retailer’s own store.

• Click-and-collect at third-party locations: This is where, usually, payment is taken online and then products are made available to collect at a location that is not the retailer’s store. Examples of third-party collection services include collection services such as Collect+, where products are made available at other participating stores, or first- or third-party locker services where products are delivered to and held in lockers for collection.

Return(s) is used to describe any returned goods from an online order. This can be done through postal means, in-store or via a third party.