future of retail
‘OMNICHANNEL’ RETAIL, mixing online and digital shopping with physical outlets, has become the default position for many retailers, with travel no exception. Gillian Simpson, Deloitte digital and
retail partner, noted “an appreciation of omnichannel shopping”, saying: “There is probably still a bit of decline on high streets, but not at the speed of previous years. A lot of high streets, shopping malls and local commercial centres are putting effort into events or pop-ups or farmers’ markets to draw people in. “We also see a lot of shopping malls
and retail parks offering non-retail opportunities such as gyms. One London shopping centre has a climbing centre and golf simulator, replacing some of the bigger retail units. Alternatives to shops are starting to proliferate and drive footfall.” Bryn Walton, Deloitte consumer
industry insight manager, argued: “People not working in offices so much is having a big impact on high streets and in certain areas in cities. [But] footfall isn’t necessarily the be all and end all. You can go to a shopping centre and not necessarily spend money in a store. There can be high
FIGURE 35: UK ONLINE RETAIL SALES Value as % of UK retail* %
15 20 25 30 35 40
37% 33% 28% 38% 34% 29% 27% 22% 20% 18%
Sept Nov 2019
Jan March M July Septay 2020 Nov
Jan March 2021
May July
Sept Nov Jan 2022
March May July Sept Nov Jan 2023
March May July Sept *Excludes auto fuel; figures rounded Source: ONS 26 Travel Weekly Insight Report 2024 22% 33% 30% 28%28% 26%26% 25%25% 30% 27% 26%26%26%26%
‘All channels need to work together’
A consistent customer experience across retail channels is essential
levels of footfall, but people go home to buy online or comparison shop.” Simpson agreed, noting: “We’re seeing
companies that previously would only have been in city centres think about their location strategies and a lot more opening in suburban high streets. People coming into the office is compressed into Tuesday, Wednesday, Thursday. But it’s still an evolving situation. I don’t think we’ve reached an equilibrium in terms of the number of days in the office.” Every retailer is feeling the pressure of
increased costs. Walton noted: “Managing cost pressures is the number-one priority for retailers, and that is going to continue. A decline in the spending power of consumers combined with rising costs of doing business have created an existential threat for some businesses.” Simpson added: “There has been
a rise in cash use for one of the first times in ages with people using cash to budget. That is an issue for retailers which stopped taking cash.”
GROWTH in UK online retail sales plateaued in 2023 (Figure 35)
DIGITAL TRANSFORMATION Online retail in the UK appears to have plateaued at about 26%, according to official data, down from almost 40% during the pandemic. Walton argued: “Everyone thought ‘We’re on a new trajectory’ when it hit 40%, but we’re on pretty much the same trajectory we were four years ago.” Simpson suggested: “People now
understand the online channel isn’t going to create all this new revenue growth. All the channels need to work together. Something we talk to a lot of retailers about is how to ensure a consistent customer experience across channels, to be clear about the role of each and not treat different channels in silos. “People might go into a store to
browse and then go home to purchase, or people might research online and make the transaction in-store, especially if it’s a big-ticket item. Being able to link behaviours in-store and online
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