British online retailers “defiantly optimistic” about the future
9 Nov 2020
Non-essential online retailers are “defiantly optimistic” about the future of their business, despite big concerns over festive trading, according to new research commissioned by Global-e, the cross-border e-commerce solutions provider.
Despite many areas of the UK being under tighter lockdown restrictions, around two-thirds (67 percent) of those surveyed by Censuswide are confident about the future of their business, and as of October 2020, over half (51 percent) of them saw growth in their domestic sales since the outbreak of the pandemic.
However, 62 percent of the 200 British retailers in the survey expressed concerns that Q4 sales would not be enough to recover from the impact of Covid-19. With 70 percent believing that festive trading in Q4 is more important to their business this year than any year previously, with 67 percent admitting it will be “vital to their survival”. As a result, 68 percent plan to begin discounting earlier this year than in previous years.
The research also added that 63 percent of all British retailers surveyed believed that a second wave lockdown would be damaging. While the first lockdown forced physical stores to close, e-commerce was a ‘lifeline’ for 69 percent of British retailers, with 63 percent having invested more in e-commerce as a result.
Of those retailers that do sell internationally, nearly half (44 percent) have seen positive growth in international markets since the beginning of the pandemic, with over two thirds (69 percent) now anticipating international e-commerce becoming more important to their business in the future.
Nir Debbi, co-founder and chief marketing officer at Global-e, said in a statement: “The global pandemic has no doubt sent shockwaves through the retail sector, with many clearly seeing their e-commerce channel as a lifeline in the wake of mass store closures. However, the accelerated shift towards online shopping worldwide isn’t equally benefiting everyone.”
When it comes to the second wave of Covid-19 and the current lockdown in England, almost half (48 percent) viewed this as their biggest concern, with only 27 percent viewing Brexit as a major concern. However, 66 percent of respondents were concerned that the introduction of tariffs for products sold to consumers in the European Economic Area (EEA) would negatively impact sales to the EU.
British retailers express concern that Q4 festive sales will not be enough to recover from the impact of Covid-19
The survey spoke to UK retailers within different sectors that traded internationally to see how the pandemic has affected their business and it found that entertainment (80 percent) and fashion retailers (69 percent) have invested the most in e-commerce following Covid-19, just ahead of department stores (65 percent) and household and DIY (65 percent) retailers.
Sports and leisure (86 percent) and health and beauty retailers (72 percent) are the most convinced that international e-commerce will be of greater importance in future trading. This is followed by household and DIY (71 percent), electricals (71 percent) and fashion (62 percent) retailers.
The research also noted that while 54 percent of fashion retailers and 48 percent of health and beauty retailers surveyed saw a surge in their international sales, while only 29 percent of the sports and leisure retailers saw such an increase.
When it comes to the upcoming Q4 festive period, less than half (46 percent) of fashion retailers view it more important to their business this year than any year previously, whilst sports and leisure (86 percent), health and beauty (72 percent), entertainment (70 percent) and department stores (67 percent) value this period more. Debbi, added: “Many British retailers have reaped the rewards of cross-border e-commerce, and 69 percent value it as a crucial part of their strategy’s future. Indeed, with the surge we’ve seen in cross-border e-commerce trading this year, it is clear that it is a vital opportunity for revenue growth and has become a key to survive the decrease in domestic sales and the closure of physical stores.
“Previous years had shown that the pre-holiday peak is a global phenomenon, with shoppers worldwide looking to benefit from the different promotions. Together with the consistent increase in cross-border trade, expending their reach to international markets will enable brands and retailers to better capitalise on the upcoming peak and drive Q4 sales. “However, if British retailers want to weather the storm successfully, the key is a strong e-commerce strategy – both domestically and internationally. Brands that will be able to provide shoppers with an optimal shopping experience that is localised to their market, will be in a stronger position in the long-term and drive sustainable revenue growth.”