The slowdown in economic activity because of the coronavirus had a huge impact on UK businesses. Any business that provides a service must consider the 2m social distancing measure to stop the spread of coronavirus. On the 23rd of March 2020 at 5pm the prime minister Boris Johnson announced that the UK was going into a complete lockdown meaning that businesses were forced to close until the lockdown ends Bars, clubs, pubs, gyms, restaurants, hairdressers, and barbers were some of the many businesses to see a sharp decrease in sales revenue following the downturn in the economic cycle as they cannot operate without breaking the social distancing measures. Any entrepreneurs who have just started up a new business are suffering the most as their money is probably tied up in unsold stock due to lack of customers because of the lockdown and a decrease in interest rates which gives them lower profit. Restaurants like KFC, McDonalds and Nandos were forced to close not only to protect their customers but also their staff at this difficult time.
What does this mean for high street retailers?
Due to current lockdown clothing retailers have been forced to close as they are ‘non-essential’ People have been buying clothes from online websites such as JD Sports, Sports Direct, Boohoo, Pretty Little Thing (PLT) and As Seen On Screen (ASOS). All these online clothes retailers have seen a large increase in revenue. From this we can see how society is adapting and moving into more digital marketing/consumerism.
Innovation of technology causing dynamic market change
Supermarket retailers have been the most successful throughout the COVID 19 Pandemic. Profits are rising while the UK is in lockdown because people are shopping for essential items. According to The Guardian the big weekly shop has made a comeback with supermarkets reporting record trolley loads as Britons develop new lockdown routines. Latest figures from grocery analysts Kantar show shoppers spent £524m more on groceries so far in April, even though the number of supermarket visits dropped sharply. There was also a near 40% increase in convenience store sales as people turned to local shops to satisfy their daily needs. The coronavirus outbreak has therefore increased the cash inflows for supermarkets such as Asda, Tesco and Sainsburys. Although there has been increasingly high demand for cleaning products, toilet roll and non-perishable goods such as rice, pasta, and tinned goods so staff have been extremely stressed trying to meet customers wants and needs when there simply is a lack of products. Supermarkets have also had to put in place trolley cleaning stations, 2m social distancing queues to protect all customers and stop the spread so they may lose customers if the queues are too long because some people may be impatient. Online streaming services such as Netflix, Amazon Prime and Disney+ have seen profits rising as people have been stuck at home due to lockdown measures. This is bad for theatres and cinemas that are losing money because of the lockdown as people may get use to watching movies and theatre productions from the comfort of their homes and decide that it is a lot cheaper to pay for an online streaming subscription rather than pay a fortune at a theatre or cinema. Additionally, online retailers like Amazon and eBay have seen profits rising as more people are online shopping however this has put a lot of stress on delivery companies such as Hermes and DHL because they have to deal with an increase of parcels and have to deliver within a certain time period which could stress the staff. They also must place parcels on the doorstep and walk away from the door to reduce the spread of the coronavirus. YouTube is also a massive online site which has benefited a lot of people throughout the lockdown. According to The Sun over a third of the UK population are now exercising daily which is nearly 6 million extra brits than before 22% of those people have been relying on YouTube for their workout inspiration. Google also reported a 239% increase in workout searches between April 2019 to April 2020. This could be bad for gyms as when lockdown measures get lifted less people will want to have a gym membership as they can exercise in the comfort of their home for free although some people may prefer specialist gym workout classes which cannot be accessed for free online. Also, if you have a poor broadband connection it might be harder to watch the videos without it buffering which is another reason why people may prefer to go to the gym not to mention the fact that some people may not have specialist gym equipment at home, so they’d rather have a proper workout at the gym.
In conclusion the innovation of technology is changing the way we shop in the 21st century. We are becoming a cashless society. Online retail is only the beginning in the next decade the high street will be adapting to the fast-paced retail changes. As consumers the coronavirus pandemic has forced us to shop online for our own health and wellbeing. Do you think online retail is a positive change or a negative one?