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COVID-19 retail impacts: 24 March 2020

24 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: From 23 March, the country became the latest European nation to enter strict restrictions to prevent COVID-19 transmission. All non-essential retailers must close immediately, with only food retailers and pharmacies permitted to remain open. The recommendations will be reviewed in three weeks.

Initial reports this morning suggest this has not triggered waves of panic-buying seen last week, which is examined in more depth by a Kantar Worldpanel report today that suggesting that extra demand is largely being driven by bigger baskets and more frequent trips (Read more here).

The immediate impact on store operations is implementation of more stringent distancing procedures, with Waitrose the first to move on this. Morrisons, meanwhile, became the latest to put its website on hiatus due to demand. The UK, in common with several other European markets, has raised limits for contactless payment, this being widely viewed as an efficient way to limit contact in stores.

Kantar Retail IQ’s Derya Guvenc has published an in-depth overview of the new measures introduced in the UK and how retailers are responding. Follow the link to download: Feeding the nation: COVID-19 in the UK

France: Increasing numbers of shoppers are turning to Drive formats during the crisis. A YouGov survey for LSA shows 45% of shoppers saying they are making more use of the click & collect model, with 65% saying they have abandoned non-food online purchasing for the immediate future. However, there are signs that Drives may be finding it hard to service the spike in demand, with Auchan Drive, for example, having waiting times of up to three days for order collection.

Germany: Calm appears to be the prevailing mood in German retail today, with shoppers largely accepting of tighter controls over supermarket admission. Some, like Rossmann, have hired extra security to impose observance of distancing protocols. In an interview with local trade media, Aldi Süd CEO Stefan Kopp said he felt the strain on store operations, while still intense, was showing signs of subsiding with “hamster shopping” less of an issue than in recent weeks. In common with other retailers, Aldi still has no plans to open on Sundays. Lidl, meanwhile, has used its Plus digital loyalty app to send shoppers messaging around Coronavirus. 

Spain: The government has approved new economic measures to curb the economic impact of COVID-19, among which are contingencies to assure the liquidity of SMEs with loans guaranteed up to 80% along with a EUR200 million relief package. At the same time, the current state of emergency will be extended until 12 April. It is also reported that financial authorities are struggling to keep up with a wave of ERTE (employee wage protection) submissions from retailers forced to lay off as many as 100,000 staff. In Madrid, fear of even tighter restrictions of movement led to a new wave of panic-buying in the city’s supermarkets on Tuesday.

Italy: Italian grocers continue battling to sustain demand, with Esselunga experiencing highest demand. Carrefour Express, meanwhile, has launched dedicated phone lines connecting senior shoppers to local stores for priority delivery.

Rest of Europe

Romania will go into a full lockdown from Wednesday; non-food retailers had already begun closing their doors in expectation of the announcement. Poland has likewise announced tight restrictions on public movement, while with worries in Russia escalating, X5 Retail Group’s Perekrestok banner has ramped up its ecommerce offer in readiness for spend switching online.

Rest of World:

What was expected to be a major event on the global retail calendar, the Tokyo Olympics 2020 in Japan, has now been postponed to 2021. India put the entire country of 1.3 billion people into lockdown as new regulation enforcement continues to disrupt the ecommerce sector. South Africa is expected to enforce isolation as numbers affected by the virus rise, causing long lines and panic-buying at major chains like Pick N Pay and Woolworths. The pandemic has seen Woolworths in Australia postpone plans to spin off its drinks division while the country’s regulator has relaxed competition rules to allow for cooperation between leading retailers to overcome supply and logistics issues.

In Asia, shoppers in Vietnam are increasingly buying grocery online, spurring super-app operator Grab to launch its GrabMart platform in the market. In China, Alibaba’s Tmall is launching Shanghai Fashion Week as a 100% digital event as the country slowly recovers from the epidemic. That recovery is shown by news that grocery stores in Wuhan have opened their doors for the first time since that city was the epicentre of the COVID-19 outbreak.

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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