Although the UK’s economy has rebounded more slowly than expected, it’s not all doom and gloom. In fact, some sectors are well and truly on the up – particularly those that have helped us through these tough times.
From online food delivery to home improvement, British consumers continue to turn to the products and services that make their lives easier; the things that bring joy and restore a sense of normality.
But our changing spending habits can leave other businesses out in the cold. Take shops, restaurants and pubs, which are getting far less footfall than they did before, with consumers hesitant to rush back too quickly.
So, as some businesses continue to bounce back faster than others, what can we learn from the sectors that are currently thriving?
The online delivery services boom
Delivery services have been growing steadily for years, but they’ve exploded during the pandemic. Just this week delivery giant Hermes announced it is creating more than 10,000 new jobs, while DPD is hiring 6,000 lorry drivers, warehouse workers and support staff.
Amazon is boosting capacity too, generating 15,000 new warehouse and delivery driver roles across the UK. But even with this improved infrastructure, it hasn’t always been plain sailing for the retailers that are performing well. They’ve had to make changes to take advantage of the delivery boom.
Take online vape store Vape Club, which saw lockdown sales peak at nearly 300% above normal figures. “The speed of stock movement presented stock management challenges, so we’ve been strengthening our logistical teams”, Vlad Vassiliev, CEO at Vape Club, said.
“There’s nothing worse than a short-term influx in sales from customers you can’t retain,” he added. “We wanted to ensure all new customers experienced the usual high levels of service, so we’ve had to quickly recruit new customer service operatives too.”
Getting creative with distribution
Of course, delivery extends well beyond retail and e-commerce, to other sectors like food and grocery. As supermarkets double-down on their delivery capacity, they’ve also had to come up with new ways to distribute their wares.
Grocers like Aldi have teamed up with online delivery firm Deliveroo, which has gone from strength to strength during the pandemic, signing up 7,000 new restaurant partners since March. Likewise, department store John Lewis’ tie-up with Co-op demonstrates how grocery chains are leveraging partnerships to expand distribution.
If there’s a way to deliver your product and it makes sense to do so, now’s the time to figure it out. And if your business delivers already, it’s worth considering what you can do to stand out. Consider offering same-day delivery, for instance, or investing in memorable packaging design.
A tech-driven approach to ordering
With people stuck at home and the good weather somehow still holding up, sales of paint, plants and compost have soared. According to the Office for National Statistics, household goods stores saw the biggest increase in volume sales in May 2020 at 42% (compared with April).
B&Q owner Kingfisher is at the forefront of this DIY boom, with its online sales surging over 225% in June. But to cope with demand the firm has had to adapt – by improving its mobile proposition and its Click & Collect service.
The hospitality industry hasn’t been as lucky, with only meagre improvements since reopening in July. But a new, tech-driven approach to ordering may help draw more customers back, by improving their experience and helping them adhere to social distancing guidelines.
Licklist, which allows customers to order from their phone to their table, is an emerging player in this space. We spoke to Brad Nobbs, its CEO and co-founder, who explained how the company has shifted away from its original focus on nightclubs, to work with pubs, cafes and hotels: “When we initially offered mobile ordering tech, the demand was limited,” Nobbs said. “But over the past few months, demand has been huge.”
Will customers continue to shop local?
Fortunately some more traditional activities, like visiting local newsagents, have also seen encouraging growth. According to market research firm Kantar, independent convenience stores grew sales by 59.5% between April and July.
“Convenience stores were a lifeline for many people in the early days of the crisis, providing essential supplies close to home,” said Fraser McKevitt, head of retail and consumer insight at Kantar.
And with more people cycling, walking and trying to avoid public transport, we may well see more people continuing to support local businesses, as they stay closer to home. Take local bike shop Sigma Sports in Hampton Wick, for instance, which saw year-on-year sales of entry-level bikes rise by 677% in April.
It seems the new habits we’ve acquired during this crisis are here to stay. Spending more time at home has made us lean more heavily on ease and convenience.
Even as things begin to open up, the businesses that meet our changing needs will be best-placed to succeed.