According to a report from Barclays Corporate Banking, click & collect is a critical component of the UK retail industry and is expected to reach a value of £42.4 billion in 2022, accounting for 8.4% of the retail sector’s income. This highlights the growing importance of integrating digital and in-store experiences in the retail industry.
Click & collect now makes up 40% of sales for retailers that offer the service, showing a significant increase from 37% just a year ago. In the UK, 41% of physical stores serve as click & collect locations and also process returns, highlighting its integral role in the overall retail experience.
In addition to boosting sales and revenue, click & collect also supports 184,000 jobs in the industry, making up 7.4% of the overall workforce in retailers with over 10 employees. This demonstrates the employment opportunities created by the growth of click & collect.
Despite the rise of online shopping, there is still strong support for physical retail spaces. The report found that 67% of consumers believe physical stores have a place in the future, with 32% strongly agreeing. However, there is a generational divide, with 74% of individuals over 55 years old believing in the future of physical stores compared to 54% of 16-24-year-olds.
The report identifies a trend called “hybrid shopping,” which combines both physical and digital interactions. Having an online and physical presence is advantageous for retailers, as 24% of consumers express hesitation when buying from online-only brands, while this drops to 13% when businesses also have physical stores. This highlights the importance of a multi-channel approach for retailers.
Click & collect’s popularity grew during the pandemic, and unlike pure online sales, which peaked during that period, click & collect has continued to grow even after the lifting of lockdown restrictions. This indicates that click & collect is a consumer behavior that will persist beyond the pandemic.
Barclays’ data also reveals that consumers like to research products both online and in-store, particularly in categories such as fashion and accessories. From a retailer’s perspective, 88% believe that operating a physical store is vital to their business success. However, retailers are re-evaluating store locations to ensure they are in appealing destinations for consumers. As a result, many have decreased the number of stores in city centers and increased their presence in retail parks, catering to the preferences of shoppers over the age of 55.
Karen Johnson, Head of Retail and Wholesale at Barclays Corporate Banking, stresses the importance of adaptation for the retail sector. She acknowledges the challenges faced by retailers due to the pandemic and rising costs of living but is encouraged by the industry’s resilience and its ability to evolve sales models. The integration of digital and physical shopping experiences presents new opportunities for retailers.
The report also reveals other interesting findings, such as early festive shopping, with discount retailers seeing the most activity. Retailers have also introduced in-store services and partnered with other brands to share retail space. Furthermore, some retailers have created co-working spaces in-store, reflecting the changing nature of retail experiences.
In terms of sustainability, consumers want retail spaces to become more sustainable, with practices such as more efficient energy use and increased electric vehicle charging points.
Overall, click & collect is a crucial and growing part of the UK retail industry. It contributes significantly to the economy, supports numerous jobs, and continues to appeal to consumers even after the pandemic. Retailers are adapting to these changing dynamics by re-evaluating store locations and embracing hybrid shopping experiences. The integration of digital and physical retail spaces presents exciting opportunities for retailers to thrive in an evolving industry.
Useful links:
1. Hybrid shopping: Key to surviving in a post-pandemic world
2. Barclays Corporate Banking – What’s ‘in-store’ for retail
