Prior to the coronavirus, there is no doubt that the High Street was gradually moving online. Internet sellers brought more transparency, showed more range and were more accessible. Their growth was not only represented in sales figures but also in the diminishing experience that customers were having when visiting the High Street, such as in Hatton Garden for instance. There is no doubt that even before 2020, the online revolution was happening.
Visiting the High Street was changing from a necessity to a luxury. More and more people started buying online and those who didn’t enjoyed going shopping for the social experience as oppose to the actual practicality of it. So, with all of that in mind, what impact has Covid-19 had on the High Street, as those dwindling few who still attended shops were no longer able to?
The high street moves online
Covid-19 acted as a catalyst in the High Streets inevitable move online. Though some businesses had already established a strong online presence, other non-essential shops that were forced to close had to adapt. This meant being able to showcase and sell products online as efficiently as possible, which broadly speaking they have succeeded in.
In a recent survey, it was found after speaking with 3700 people that more than half of them admitted since the start of lockdown they now shop online more frequently. Online purchases increased by 6 to 10% and though the amount of money being spent in total dropped, this can be put down to the fact tourism/travel trades have seen in a 75% drop in average profit, a reflection of lockdown restrictions as oppose to the High Streets ability to adapt to them.
In this new era of online shopping, those who were reluctant to engage with it at first are seeing the benefits, as research suggests that there are a number of people who didn’t shop online before lockdown that intend to keep on doing so when retailers re-open. “There is an enormous opportunity for industries that are still more used to physical shopping,” said Yomi Kastro, founder and CEO of Inveon, “such as fast-moving consumer goods and pharmaceuticals.”
Online moves to the high street
One of the biggest profits made during the pandemic and a trailblazer when it came to companies adapting to selling products online was Amazon. Over 2020 Amazon had their net profit increase by 84% and sales of $386 billion. With this in mind, why have they chosen now to open their first physical shop in the UK?
In March 2021 Amazon opened its first ever grocery store in London. Arguably, this move couldn’t have come at a better time as they are offering customers a till-less service where you simply scan a smart phone app, pick up produce and walk out. In the current climate where human contact is encouraged to be as limited as possible, this new system seems perfect. In the same way that online shopping has become more accessible and easier to manage in the wake of covid-19, is this new system that Amazon implements in its store a premonition that physical shops will need to adapt too?
Whilst supermarkets and other stores have been trying to perfect their own check-out free service, which people seem to be content using, what Amazon offer with their new system is a much more frictionless experience. This method combines the leisure of shopping on the High Street with the simplicity of shopping online.
How real is the online revolution?
As online retail and high streets develop in unison to one another, the question remains, which will be most prominent in our day to day lives once we are able to move about freely? Well, that’s difficult to say. Research indicates that people who have made the change to shopping online are content on sticking with it, whereas those who enjoyed shopping on the High Street and did so for the social element, will likely be keen to return once stores re-open. If so, will the shopping experience be the same as what people were used to?
There will certainly be a change and though the increased number of those who shop online may drop slightly, it is extremely unlikely it will go back to pre-covid levels, especially now so many retailers have established a strong online presence during the pandemic. Whilst some businesses have been ready for the online revolution for some time, others will need to ensure their Ecommerce is smooth enough that people can use it long term.
Meanwhile, whilst people may want to get back into shops for the social element of window shopping and browsing, this experience should come with the smoothness that online shopping offers. Amazon could well lead this move, the same way they have led retailers to working online, with their new till-less stores.
|About the author
James Sanders is the Managing Director of London Diamonds, a company founded with the intention of disrupting the jewellery industry. Working with designers, buyers and diamond experts from around the world, he has always been adamant on putting the client first and continues with that approach in every decision he makes.
Innovative, he is always looking for exciting projects surrounding Gaming, AI, Bitcoin and Gold to invest in. He believes these are interesting times rich with opportunities for those who are willing to take them.
As such a prominent name in both business and investment, he is adamant on keeping on top of current affairs.