The high-street has experienced a rapid decline in footfall and sales since the rise of online shopping and the recent pandemic. Customers are turning to online stores to shop for clothes, food, and various other items. The UK’s smaller towns were filled with empty stores and boarded-up windows before the pandemic. After lockdown, the UK’s high-street was in ruins, and major brands, like Topshop, did not reopen their stores.
According to a recent report by Alvarez & Marsal, the UK retail sector is losing profits at a rapid rate and is predicted to lose £8 billion in profits by 2025. Pre-tax profit margins are expected to fall by 3.2% by 2025, and nearly 20% of spending on apparel, homeware and electrical will become permanently online.
Retail brands need to understand the value of online shopping and how to navigate the digital world. Brands with strong loyalty programmes can expect to see improved customer retention and increased sales.
Online shopping has replaced the in-store shopping experience, and most consumers prefer the convenience of it all. In a recent survey, nearly half of respondents agreed that the high-street is a thing of the past and online shopping is the future. In January 2021 alone, UK online shopping sales increased by a staggering 74%. Mobile e-commerce sales have increased year on year by a whopping 169.1% in the UK. The explosion of online shopping is growing at an unprecedented rate – and the UK’s high-street stand’s little chance of competing with the digital monster.
Furthermore, the UK’s markets were unable to trade for extended periods of time during lockdown. Both outdoor and indoor markets across the UK have lost income and their regular customers. While the UK government made steps to support these markets, it may be too little too late. Rent payments for market stalls have been deferred, and some spaces are even free of charge. As the restrictions lift, there are plans to encourage tourists and visitors to attend the local markets to increase revenue. Hotels may offer free shuttle buses to local markets to increase the total footfall, and hopefully, market sales.
COVID brought a turning point for eCommerce and accelerated the retail industry’s transition to the digital world. Before the pandemic, the high-street stores were managing to survive alongside online shopping. However, the pandemic forced the retail industry to turn digital and raised e-commerce’s share of global trade from 14% in 2019 to 17% in 2020.
The pandemic brought on a massive influx of change to industries across the globe. Many of these changes involved technological advances and the transition from in-person to online trade. Technology is establishing an increasingly prominent presence in our lives – and it looks like it’s here to stay.