One of the things that we can agree on about 2020 is that it has been a year of accelerated change and diversifying retail models.
This change, in the worlds of retail, F&B and public space has been driven by changes in customer behaviour – behaviours that have adapted as a result of necessity. For example:
- In a survey commissioned by the United Nations of 3,700 customers in nine emerging and developed economies (Brazil, China, Germany, Italy, the Republic of Korea, Russia, South Africa, Switzerland and Turkey), more than half the survey’s respondents now shop online more frequently.
- In the UK, The number of customers doing their weekly grocery shop online has doubled since the first lockdown. Waitrose has revealed that more than three-quarters order at least some of their regular household goods from supermarket websites – up 61% last year, and that 40% of people say they will shop online more than they did before the outbreak.
In this review, we’ll take a look at some of the retailers and brands – both online-first and traditional brick and mortar – that have responded to changes in their customers’ behaviour to improve engagement and sales in what has been a very challenging year.
Pizza Hut: Doubling down on delivery
Pizza Hut is set to hire 2,500 staff in a sizable recruitment spree after a surge in demand for takeaway. This programme will necessitate an expansion of its physical footprint by 125 more locations over the next three years, according to Neil Manhas, GM of Pizza Hut UK.
Bacardi: Classy cocktails at home
The premium drink and cocktail category has seen a majour shift due to customers working from home, and wanting something celebratory to mark the end of the working day.
In April, Bacardi joined with Deliveroo to help partner bars deliver bottled cocktails to homes across London. The drinks group has also acquired Yails Cocktails, a pre-batched premium brand launched in London in 2010, which offers bar-style cocktails in litres and kegs. According to Francis Debeuckelaere, head of Bacardi’s Europe-wide commercial operations, customer behaviour changes seen during the pandemic will stick – especially as part-time home-working becomes the norm.
Supermarket: Fresh food markets
Customers have spent much of their time at home, unable to venture out and explore. As Times journalist Janice Turner expressed on Twitter, she was so bored in lockdown, she went to Lidl for somewhere to go at night. Supermarkets are beginning to acknowledge their status as inviting places to visit. Sainsbury’s have just upgraded their Hempstead Valley store with a new food hall that includes a refreshed café, new look bakery, hot pizza counter, self-serve patisserie counter and food-to-go hub.
Further down this line, Morrisons Market Kitchen in Manchester is the company’s first standalone Market Kitchen concept and an evolution from its Market Kitchen in London’s Canning Town. The focus is solely on foodservice, and combining choice and simplicity of operation. There are an abundance of counters, and each has just one or two lines on offer, reducing choice and maximising efficiency, ensuring a smooth customer experience. The company has just launched the next iteration in Edgbaston, Birmingham.
Pret coffee subscription
Pret a Manger have launched a subscription giving customers the ability to purchase up to five drinks a day – including coffee, tea, hot chocolates, smoothies and more, for £20. Customers subscribe online or instore, and then simply scan a QR code at the point of payment.
Leon has also launched a similar subscription service, which offers customers the ability to purchase as many hot drinks as they can drink or carry for £15 a month.
Which of these changes are fads, and which are likely to stick around is up for debate. Regardless, it has been interesting to see how retailers and brands respond to fundamental market challenges and evolving customer habits. If you’d like to discuss how we could help your brand evolve alongside, get in touch here.