Amid a slew of strategic shifts focused on online growth and store closures, it was refreshing to have some timely reminders of the power of bricks and mortar this week.
The coronavirus pandemic might have introduced a fresh wave of consumers to online shopping for the first time, driving up online penetration and forcing a host of retailers to accelerate their digital journeys, but a physical presence will remain a crucial weapon in retailers’ armouries.
Just in case any retail leaders needed reminding of that fact as they ponder how the role and size of their store estates may need to change in a post-coronavirus world, Next and Majestic Wine stepped forward to provide it.
The fashion bellwether posted a “better than expected” second-quarter performance, when store sales were “more robust than anticipated”.
Like-for-like sales through Next’s estate were down 32% year on year between reopening on June 15 and the end of the quarter on July 25. In the final week of that period, like-for-likes in stores were down 24%.
Considering the nosedive in footfall and consumer confidence since the comparable period in 2019, that’s a pretty solid return.
Majestic registered a surge in online sales during lockdown, serving more than 150,000 new customers through its home delivery service and expanding its tie-up with Deliveroo to offer speedy deliveries from almost 140 of its shops.
Majestic offers a blueprint of what retailers’ physical stores will need to become if they are to remain relevant as they emerge from lockdown
But Majestic boss John Colley observed: “We’re seeing customers who have discovered us as an online retailer over the past couple of months now visiting our stores – and getting the true Majestic experience.
“If anything, this has given us more confidence in the role of our bricks-and-mortar arm and its ability to offer a truly multichannel experience for our customers.”
Majestic offers a blueprint of what retailers’ physical stores will need to become if they are to remain relevant as they emerge from lockdown.
It lays on personalised tasting sessions to help customers select the right wines for functions ranging from dinner parties to weddings. Those have had to be paused during coronavirus, but Majestic is already inundated with new post-lockdown requests from customers seeking to tap into the retailer’s expertise.
Its staff are already among the most knowledgeable in the business, but as part of a five-year growth plan also unveiled this week, Majestic said it would invest even more in staff training to set it further apart from its rivals.
They are characteristics that simply cannot be replicated online and represent strong enough draws to coax customers off their tablets and into shops.
As Colley put it: “Our stores are at the centre of who we are and what we do.”
Very few retailers can say the same with such conviction. It is those who genuinely can that will flourish in the post-pandemic world because, ultimately, people still want to visit shops.
A social experience
Online revenues may have soared during the crisis, but even during lockdown physical shops accounted for around 70% of total retail sales in the UK. Admittedly, much of that was driven by the necessity to shop for food items, but it was clear that consumers also valued retaining a semblance of normality in their lives at the height of the pandemic.
Now, as lockdown measures ease, visiting the high street, retail parks or, to a lesser extent, shopping centres, with friends or family members offers a social experience that many have been missing.
Just this week, property giant Unibail-Rodamco-Westfield – owner of the Westfield London and Westfield Stratford malls – underscored that trend, revealing that footfall and sales at its destinations were recovering “faster than we would have anticipated”.
Believe in your stores, invest in your stores and create enough compelling selling points to differentiate them from online propositions
In France and Spain, where the majority of its shopping centres are located, footfall has already bounced back to 80-90% of last year’s levels.
URW finance boss Jaap Tonckens said he had “absolutely no doubt” that malls could continue to thrive following the coronavirus crisis, pointing to the fact that retailers are still opening stores as evidence of the belief in bricks and mortar.
It’s a belief that is far from misplaced. Don’t believe all of the online hype – shops still have a huge role to play in post-pandemic retail.
Take a leaf from the books of Next and Majestic – believe in your stores, invest in your stores and create enough compelling selling points to differentiate them from online propositions.
But whatever you do, don’t write off stores just yet.
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