InPost, the send, collect and return parcel locker service, has revealed research highlighting half of UK shoppers (50%) are set to switch to larger retailers for gifts as we get closer to Christmas, a trend that is particularly pronounced amongst 25-34 year olds (68.5%). As a result, 39% of SMEs feel like they will lose out this festive season.
The study, conducted by retail analysts Conlumino, in partnership with InPost, shows that while Christmas gift spend is expected to reach just shy of £8.5bn this year, shoppers are only planning to allocate 13.2% to small or medium-sized chains and local independents. Price (39.4%) and product range (24.6%) are inevitably the key drivers of spend, however factors relating to convenience, such as delivery and pick up options, also play a major role (21.2%) and can sometimes make the crucial difference.
Indeed, click and collect to a store or locations such as automated lockers will account for 7.8% of gift spend (over £700m) as almost a third (29.5%) of consumers intend to use click & collect services this Christmas. However, with less than a fifth of SMEs (18%) offering such a service, compared to 60% of large retailers, SMEs could lose out to the tune of an estimated £200m during this critical time of year for the retail sector. Over half (51.3%) of SMEs acknowledge this as a key reason why shoppers will switch yet 42% of consumers who confess to favouring larger retailers could be swayed by smaller chains that offer online ordering and convenient delivery options.
The younger shopper is the most demanding when it comes to the convenience of Christmas shopping and the fulfilment of gift orders. Over two-thirds (69%) of 25-34 year olds choose to make the switch to larger retailers at Christmas time versus 40% of those aged 65 and over, many of them driven by fulfilment issues and the fact they don’t fit with their busy lifestyles. Half (50%) of those aged 18-44 admit they would be more likely to shop at smaller chains if they offered online shopping and delivery to home and 47% would use them if they offered click and collect services.
Neil Saunders, managing director of Conlumino, said: ‘The good news for smaller retailers is that while many claim to be planning to switch, almost half (49%) of shoppers say they’d actually prefer to give them their custom rather than the big fish. However, they need the reassurance that they’ll be able to get what they want, when they want it. We therefore encourage smaller retailers to consider partnering with logistics providers, investing in online and improving their delivery and collection options so that they stand a better chance of competing. Convenience counts for a lot, particularly amongst the younger generation.”
Jonathan Smith, chairman of InPost UK, said: ‘Overall, two-thirds (64%) of retailers agree online shoppers are demanding more convenient fulfilment options and it’s having an impact on how they’ll spend this season. Therefore improving fulfilment capabilities is one way for smaller retailers to fight back this Christmas.”
“SMEs should consider solutions such as automated locker networks that don’t require lots of investment and which would not only help them extend their reach by providing 24/7 collection locations across the country, but which also provide easy drop off points allowing them to quickly and easily send multiple items at once without the queues.”
InPost now has a network of more than 1,000 automated lockers across the UK which can be found at a variety of safe and secure locations including at Morrisons supermarkets, petrol stations, train stations and Transport for London sites, outside retailers such as Toys R Us and at local shops across the UK. They are all accessible 24/7/365, meaning no more queues or waiting in, enabling consumers to collect and deliver items at their earliest convenience.