Online retailers win record share of shopper spend in May 2020

Independent food retailers that set up online services following lockdown will likely be reaping the rewards as official figures have revealed that online retailers won a record share of shopper spending last month.

According to the Office for National Statistics’ latest Retail Sales Report for May 2020, 33.4% of all UK retail sales took place over the internet in May. Online sales rose by 19.7% online compared to April, whilst a record proportion of food sales took place online as consumers continued to stay at home during the pandemic. What’s more, e-commerce for food retailers grew by 21.2%, accounting for 11.3% of all retail sales in the category.

The results are perhaps unsurprising. Whilst online shopping has been growing over the years, the coronavirus boost meant many food retailers saw an increase in online sales. For those that didn’t previously have an online store, setting one up to cater to customer demand and meet Government guidelines throughout COVID-19 allowed them to find a new sales channel when in-store sales dwindled.

Richard Lim, chief executive of Retail Economics, said: “A seismic shift towards online pushed this channel to new heights. Retailers have been working tirelessly to boost their online capacity to cope with this intense period of demand. Those with the most flexible operating models and who have been fleet-of-foot are retaining customers and reaching out to a new wave of online converts.

“Many consumers are shopping for products they had previously only ever purchased in a shop. They are overcoming the initial barriers of setting up online accounts, entering payment details and gaining trust. This shift in behaviour will inevitably be sticky for a large proportion. The critical question retailers will be asking themselves is how long-lasting the shift will be.”

Whilst the future is reasonably unknown, many in the industry agree that online shopping is here to stay, whilst consumer surveys have revealed that many shoppers plan to continue purchasing essentials like groceries online even after shops reopen.

For retailers that perhaps closed during lockdown, it’s never too late to get your home delivery service up and running. Those that are already well-established in the online sphere may now look into ways to maximise their website to make it more profit-ready, whilst others may start tapping into the opportunities that social media brings, in an effort to increase their market share.

The Ultimate Guide to Online Retail includes advice on these subjects and more, with expert comments, tips and case studies from those in the industry, including Riverford’s Guy Singh-Watson; Mathew March-Smith, co-founder of online cheese destination, Pong; and Food Marketing Expert‘s Vhari Russell.

Download your free copy here.