Consumers return to the High Street

Hello and welcome to This Week in Retail. With Boris’ roadmap now in full swing, this week marked another significant step towards a post-Covid world for the UK with non-essential retailers opening their doors for the first time in almost 4 months.

You could be forgiven for thinking that it was the start of the Boxing Day sales if you were unaware of the significance of 12^th April, with consumers queuing in the early hours of the morning in anticipation of High Street stores re-opening. Whilst I myself did not venture down to the shops at the crack of dawn on Monday morning, it represents a stark contrast from April 2020 with footfall up by 410% compared to the same time last year.

One of the most common themes that we have covered in This Week in Retail throughout the pandemic are the initiatives that retailers have implemented to attract increased market share. This week is no different, with many household names introducing incentives to encourage shoppers back into the bricks-and-mortar experience.

M&S has refreshed a number of instore services to “best serve customers how they want to shop today”. Changes will include an expansion to its Pay With Me on-the-spot payment service to 50 of its top lingerie stores, digital check-ins to make order collection easier and instigating ‘greeters’ at the doors. This represents an intelligent move by the retail giant as they look to maintain strong customer service whilst also effectively managing instore footfall traffic to promote a safer shopping experience.

Similarly, John Lewis has reinvigorated an existing instore policy by increasing customer rewards from £5 to £10 when customers opt to use its Beautycycle service which encourages customers to return hard-to-recycle packaging in return for £10 off their next beauty purchase. Nike has also launched a recycling initiative throughout the US where it will start refurbishing sneakers returned by shoppers and selling them at a cheaper price to reduce consumer waste.  The scheme seemingly presents a win-win situation for Nike and its customer base as they can clearly demonstrate that they are taking steps to improve the sustainability of their products – a trait that is becoming ever more important, whilst also allowing customers to purchase high quality goods at a reduced price.

Perhaps one of the most interesting stories from this week is news that Ocado has purchased San Francisco-based Kindred Systems and Las Vegas-based robotic arm design Haddington Dynamic. The acquisitions aim to boost Ocado’s robotic manipulation capabilities by increasing warehouse automation and allowing the online retailer to improve upon its current capacity to process 65,000 orders per week. This represents yet another example of how the pandemic has forced retailers to accelerate the modernization of their operational processes to increase their flexibility and capacity to respond to changes in customer demand through technology.

Staying on the topic of grocers, we finish this week by looking at a retailer which has been a symbol of consumer spending habits throughout the pandemic – Amazon. Following the launch of two grocery stores in London, Amazon has unveiled a new private label food brand called Aplenty, which will eventually include hundreds of new branded products as it continues its relentless push into grocery both online and on the High Street.

The easing of the Lockdown restrictions will be a welcome relief as non-essential retailers look to recover from the an estimated loss of £22bn in sales throughout 2020, which claimed a number of household High Street names such as: Arcadia, Debenhams, Oasis and Warehouse, Cath Kidston and Thorntons. Whilst nobody is under the illusion that we have passed the effects of the pandemic, the first week back is one full of hope and invention from retailers as they look to entice customers back to the bricks and mortar experience.

Peter Flood

Senior Software Engineer