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Research by Mintel revealed that in April 36% of Brits increased their online shopping, compared to just 7% in the early stages of the outbreak before social distancing measures. Mintel expects the online grocery market to grow by 33% in 2020 to reach an estimated value of £16.8 billion – a phenomenal rise following four consecutive years of slowing growth.
For specialist retailers, this means having an online shop is no longer optional. “Businesses that have done well over the past three months were those already set up for online. They had a head start and will have been able to further adapt and improve their services. Many who weren’t online began offering options during lockdown but didn’t always have the skills to build a sustainable system,” says Lee Smith, global head of commerce at Kantar’s Insights Division.
FSB national chairman Mike Cherry said Covid-19 had caused one in six small firms to increase their existing online presence or create a whole new one in order to stay afloat amid the lockdown. “Many were already offering services online, and others were looking to branch out, prior to March, so the pandemic has very much accelerated the move to digital.”
But the pandemic-influenced rise in online sales exposed huge flaws in grocery e-commerce, with even Ocado failing to keep up with demand and having to stop accepting new customers altogether. “Even Christmas aside, I think it’s a really important time for SMEs to review their [online] strategy,” says Fiona Fitzpatrick, food and beverage growth consultant and host of the podcast Brand Growth Heroes. “And that means revisiting your purpose and revisiting your vision for the business, which will have changed.”
At Christmas, in-store shopping is a nostalgic experience, but this year consumers may be physically unable to shop as they would like to. “The big Christmas shop as an event, with consumers making a day of it to go out and pick up festive supplies on the high street in one go may not be so easy this year if social distancing remains in place. This leaves the door open for retailers with well-established e-commerce operations who could capitalise on shoppers choosing to limit travel and buy online,” explains Matt Botham, strategic insight director at Kantar.