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COVID-19 retail impacts: 20 March 2020

20 Mar 2020 / By: Kantar Research Team

Welcome to today’s briefing on the effects of Coronavirus on the retail landscape in Europe and EMEA. While in no way definitive, we hope to ensure our clients are kept as informed as possible on new initiatives, developments and trends emerging as this crisis unfolds.

Europe

UK: Overnight, the British government brought forward measures to help supermarkets work together to meet demand by temporarily relaxing competition rules and removing trucking regulations to allow for more delivery slots. This comes as leading retailers are increasingly reducing ranges to focus on essentials, with some categories slashed by ~75%. Elsewhere, the impact on non-food has been highlighted by Marks & Spencer and clothing giant Next, which predicts a potential GBP1 billion sales loss this year. Staffing remains top-of-mind for most retailers, with Lidl and Aldi both announcing hiring drives today. M&S (including Ocado Retail), Lidl, Aldi, Danone and Coca-Cola have created a new fund to support community organisations helping those most at risk during the Coronavirus crisis.

Spain: Kantar Worldpanel in-depth analysis of Spanish consumption trends from the end of February into March details the remarkable sales surges across key channels during the period. Read more: The effects of the coronavirus on Spanish consumption. Elsewhere, Inditex brand Zara is switching production facilities to manufacture of masks to aid protection efforts. Remaining in Iberia, additional Worldpanel research lifts the lid on how Coronavirus is impacting consumption habits in neighbouring Portugal. Read More: COVID-19: the initial impact on consumption in Portugal.

Germany: A new government initiative enables displaced workers from sectors like hospitality to shift to the retail sector to boost staff capacity. Germany is also considering flying in Romanian seasonal workers to help with harvests to circumvent travel restrictions. Retailers have seen demand for tinned, ambient and hygiene goods spike ahead of a lockdown to begin in Bavaria from tomorrow, with a late-night stampede to stores expected this evening. Aldi Nord and Süd are presenting unified messaging that further emphasises how the two divisions are moving together in terms of supply chain and go-to-market strategy.

Italy: A new GroupM study reveals that downloads of supermarket shopper apps have surged 21.2% since the outbreak, with daily use up 116.3%. Esselunga and Conad are the chief beneficiaries of this trend. Between 24 Feb-8 Mar, total retail sales climbed 11.7% YoY with grocery ecommerce up 82.3% YoY by 8 Mar despite delivery waiting times now as long as 2+ weeks. Manufacturers are less well-off, however, with 53% of Italian food companies having overseas orders cancelled.

France: With ecommerce uptake soaring, pressure on distribution networks is intensifying. This will likely increase as collection points close - at La Poste, only 1,600 of 7,700 offices remain open – and more logistics workers self-isolate due to sickness. In this regard, Casino banner Franprix has signed a delivery partnership with intermediary Deliveroo to increase its fulfilment capacity as demand rises.

Rest of Europe

Authorities in Poland may lift the controversial Sunday shopping ban to meet elevated demand, while in the Netherlands B2B wholesalers are accepting household shoppers in response to new rules from government, with Metro AG stores in Austria following suit, suggesting this may be a Europe-wide initiative from the wholesaler. Russia retailers, led by market-leader X5 Retail Group, are concerned about rising wholesale prices, while in Denmark, leading player Salling is bringing forward supplier payments to ensure their survival.

You can gain further insight and analysis on the impact of COVID-19 on brands and retail by visiting the dedicated Coronavirus content page at kantar.com. Click here to visit the page


Kantar Research Team

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