How Britain has changed
UPDATED 24th September 2020 with new data
Following on from our State of the Nation report in July, we look at four changes to society that we think are likely to become a way of life.
Slides can be downloaded as a PowerPoint deck at the end of the article. Please feel free to use them as you wish.
Working from home is here to stay
Lockdown has shown that many people do not need to go into the workplace to be productive. Working from home can be just as effective and has been embraced by over one quarter of the workforce.
ONS data for the period 24th August to 6th September 2020 shows that:
- 27% of the workforce were working remotely
- 57% were in their normal place of work
- 12% were on furlough leave
There are, however, differences by sector. Seven in 10 staff working in the Information and Communications sector are working remotely along with just under two-thirds in professional industries. Health and social care workers and those in the water and waste management sector are the most likely to be at their normal place of work while food services and arts and entertainments are more likely to remain furloughed.
The proportion working from home has fallen slightly over the last few weeks as schools and colleges have reopened and the push to get office workers back into the office has taken effect. However, with workers once more encouraged to work from home when they can, it is highly likely that remote working for at least some or all of the working week is here to stay for a significant number of people.
We have embraced online shopping like never before
In February 2020, internet sales represented 20% of all retail sales. By the end of August 2020 that figure had shot up to 28.1%. At the same time the value of all retail sales (the amount spent) was up 2.5% compared with February 2020.
Although the proportion of food sales online had more than doubled in that period, it still only represented 10% of all food sales.
Each category has seen significant shifts in purchase behaviour. Online sales in clothes & shoes now represents 29% of sales in the category (from 20.6%) and sales through department stores also represents 29% of all department store sales (up from 16.5% in February).
For clothing & shoes the shift towards online sales has not been sufficient to compensate for the lack of spend in store. The volume of sales in this category is down 16% on its February 2020 level but this is an improvement compared with the July figure of -26%. Department stores are slightly below pre-lockdown levels but household goods are above fuelled by purchases from DIY stores.
The volume of all retail sales made through the internet in August was actually down by 2.5% on the previous month and in July it was down 7% on June. It is, however, up 47% compared with February which suggests that buying online is a habit that will stick for many.
Consumers are looking for value and will be blending online with offline purchase journeys. Retailers will have to be value conscious (and by association cost conscious) but also need to ensure they have the logistics in place to make the blended experience seamless.
We are not visiting leisure, entertainment and retail attractions as much as we used to
Data from Google's Covid 19 Community Mobility Report (11th September) shows that visits to restaurants, cafes, shopping centres, theme parks, museums, libraries and cinemas are down 16 percentage points compared with pre-lockdown February 2020.
The data also show that visits to public transport hubs (underground, Metro, train and bus stations) are down 28% compared with pre-lockdown days.
We are, however, making good use of parks and beaches to enjoy the summer weather. Visits to these places are up 97% compared with the February 2020 baseline.
We are visiting leisure, entertainment and retail attractions less at the back end of summer than we did during the middle of winter. Given recent spikes in Covid-19 infection rates, it seems that the number of people visiting attractions will not return to normal levels anytime soon.
This data is from mobile phone users who have enabled location data to be collected.
We are less confident, more anxious about the future
Consumer confidence is low. As at 17th September 2020 the Freemavens index of consumer confidence (known as Covindex) stood at -40.4 (+100 being the highest and -100 the lowest on the scale). Prior to lockdown the Covindex was in positive territory but only just.
Although there has been a slight recovery in the index since lockdown was imposed, the long term trend is one of anxiety about the future. This obviously relates to both the state of the economy and resultant pressures on the job market but also the possibility of local lockdowns or worse as Covid-19 infections accelerate as we head for winter.
In order to appeal to nervous consumers, brands will need to stay relevant, show empathy and deliver value in their offer (be it products or customer experience).
Freemavens Covindex is based upon an analysis of Google searches on around 400 variables. These include searches in relation to mental health and wellbeing, job security, financial worries and purchase intentions.
Although very different from survey-led confidence indices (GFK Consumer Confidence Index for example), Covindex provides a very similar direction of travel as can be seen from the latest GFK graphic below.
We believe that these four changes are likely to continue well into the future. The implications for each business sector will vary and are likely to be different according to each market.
We have views on their implications across different sectors and would be happy to share with you. Just get in touch for a chat.
Handy charts from this article for you to download and use as you like
