Boots’ focus on premium beauty supports COVID-19 recovery, says GlobalData

Following today’s release of Boots’ figures for Q4 FY2020/21; Juliet Cuell, retail analyst at GlobalData, a leading data and analytics company, offers her view: “Boots’ Q4 performance highlights its continued steps toward recovery from the impact of the COVID-19 pandemic as comparable retail sales increased by 15.0%. While the health & beauty specialist did report stronger comparable retail sales growth in Q3 (+38.7%) as it benefitted from the initial bounce back of footfall as restrictions eased, Q4 footfall remained below pre-COVID-19 levels, inhibiting growth. The retailer’s comparable pharmacy sales were also up 11.4%, aided by demand for its post-travel testing service as travelling abroad became more accessible to UK consumers.

“While consumers shifted their health & beauty spend online at the height of the pandemic, Boots’ new marketing campaign focusing on its premium beauty range is a good way that it can encourage the transfer of spend back to stores, increasing awareness of its 30 new beauty halls that are set to be completed in 2022, and its beauty range which it increased significantly in 2020. Nevertheless, there are clear areas of improvement for the health & beauty specialist and Boots should offer a more interactive customer experience in these beauty halls, such as make-up masterclass events or wellness information sessions to compete with clothing specialists such as Flannels that will offer a concierge service in its beauty halls opening next year and Next’s increased beauty offer. While its marketing strategy and beauty halls centre around its premium proposition, Boots should not lose sight of its more budget-friendly offer with Boots having lost out to grocers during the pandemic. It should continue to provide initiatives such as double points on its Advantage Card scheme to aid customer retention and compete with supermarkets as they appeal to the price-conscious consumer. 

“ reported sales were up 54.0% in this financial year and in August 2021, rolled out a trial partnership with Deliveroo across 14 stores that will bolster demand for its online services. If this proves successful, Boots should leverage its extensive store network to compete with grocers such as Co-op that offer some health products such as cold remedies, for delivery via Deliveroo and Gorillas, which delivers in as little as six minutes to parts of London.”