Outlook: Key points that British brands and retailers must address in 2022

1/ Selection of the right sales channel – online or physical?

Whilst online sales are becoming the preferred way to shop, total online sales in March 2022 compared to March 2021 declined by -21.8% across all retail sectors . However, according to a survey by Statista, 25% of market leaders in the UK stated that digital marketing contributed to their performance, and they expect spending to increase online by 28.29% by the end of 2022 . Retailers need to select the correct sales channel. These can be:

physical store
website or app
marketplaces
social commerce

Consumers demand an outstanding shopping experience, not just a fast and easy way to shop so the right sales channel is essential. More than one is advisable, and a combination of all of the above has the potential for more sales and profit. A retail store website should be the core of the business with social media and marketplaces feeding from it. To maintain consumer loyalty retailers need to create a channel that visitors interact with, return to and purchase from. Online marketing increased sales opportunity examples:

clothing retailers present complete outfits with complementary shoes and accessories
DIY stores have a social channel with demonstrations on to carry out DIY projects
food retailers offer economical, easy-to-make recipes

These ‘add-ons’ make the difference between a platform a consumer wants to interact with and revisit or one they only use once as it doesn't hook them. The strongest and most successful brands are those that get this right and build the customer’s trust and loyalty through using multiple sales channels.

2/ Building customer loyalty and demand

Brands and retailers that are successful in 2022 will be those which generate increased consumer demand. Brand loyalty comes from constant interaction and a connection with the product. This requires market research and an understanding of the customer’s needs. It also results from the right marketing strategies that build a relationship with the consumer. Marketing methods British brands and retailers can use to grow awareness through interacting with their audience include:

loyalty-building schemes – newsletters, blogs, unique promotions
publishing positive customer reviews
regular posting on social media
video marketing
offering excellent customer service (free deliveries/returns/samples/follow-up queries)

A brand or product needs to stand out from its competitors to boost sales. Companies producing British products can promote their ‘home-grown’ brand by focussing on the local aspect of their product. Emphasising the benefits to the community of buying British will appeal to the emotions of the consumer. Uniqueness is also a key factor. For example, a craft beer company may have a product range of 50 beers, but how many are unique and who is the target market? According to the Society of Independent Brewers’ 2022 report, 81% of women enjoy drinking a unique, artisan-style beer . This is the perfect opportunity to tap into a niche British market. The objective is to promote awareness and keep the consumer engaged through promotions and the feeling that the brand is treating them as a valued customer, not just a statistic.

3/ Address supply chain issues

Consumers don't like to wait for the products they order; if they can't get it quickly from one retailer they’ll go elsewhere. Over the last few years, supplies have been affected by Brexit, the COVID-19 pandemic and shortages of materials. During the pandemic many retailers closed, never to open again or set up online. Those that have found success in online sales are the ones that adapted to change fast and have therefore seen an increase in online traffic. World events such as the Ukraine war with Russia and the Ever Given blockage of the Suez Canal have caused supply shortages both globally and throughout Europe. These shortages range from food products to materials used to make garden gnomes in the UK. There have also been driver shortages, particularly in the UK due to Brexit, leading to supply chain problems. Another issue has been a decrease in demand as prices rise. This means higher transport costs and longer lead times. Retailers who address these issues and find a way around them are more likely to succeed and keep customers. Retailers should also look at their supplier base and address the ‘too many eggs in one basket’ syndrome. Just using one supplier who may have logistical problems at some stage can lead to disaster for any retailer. Empty shelves do not attract customers. Facing these challenges and adapting to change will contribute to the success of British and European retailers. This requires a review of the supply management chain and how it can be improved.

To maintain and increase customer loyalty, transparency is essential. British retailers need to share their actions and highlight their strategies to keep retail moving. British retailers with vision who look to the future and adapt to change are those that will succeed in 2022 and beyond. With so many challenges in the retail industry, it’s essential to take control.

4/ Promoting and achieving sustainability

Every business has a role to play in offering sustainable products, wherever in the world it is located. From replacements for plastic packaging to reducing transport costs, environmental retail is high on the consumer’s agenda. The UK Government is committed to achieving ‘Net Zero’ by 2050 to reduce global warming. This is a worldwide strategy designed to reduce the emissions which cause global warming. The British Retail Consortium reports that 63 retail businesses will achieve Net Zero a year earlier in 2040. This plan encompasses decarbonising:

stores by 2030
deliveries by 2035
products by 2040

The 63 are all large British retailers that have the resources to reach this goal. However, every little counts and any small retailer increases its PR by announcing its part in Net Zero. This also leads to the question of whether it is not only cost-effective but also sustainable for British retailers to only have e-commerce sites. Sustainability comes in other forms too, for example, the growth in consumers purchasing second-hand clothing from retailers, not just charity shops or eBay. From stores selling luxury brands to retailers such as ASOS offering an online marketplace to sell second-hand clothing, sustainable clothing is a growing trend. This sales strategy also has an advantage as overall prices rise as consumers still look for clothing bargains in lean times. It's not enough to state a product is sustainable. Consumers are educated and want to understand the integrity of the brand by being informed:

if the product/packaging is biodegradable
how products are transported
if suppliers are evaluated for sustainability
what a company’s waste policy is

Other ways for British retailers to promote sustainability are:

to use clean energy
reduce paper use
recycle when possible – e.g. ink cartridges, shop fittings, product components, packaging
adopt carbon-neutral transportation

Building partnerships with sustainable companies is another way to gain the trust of consumers. A sustainable logo on a website gives credibility.

Photo: Tom Fisk

Naomi Botting