Study shows Covid has had “little impact” on wholesale digital growth
The Covid-19 pandemic has had “little impact” on wholesale route to market, according to a new industry report.
The Lumina Intelligence UK Wholesale Report 2020/21 found retailers haven’t flocked to use digital wholesale channels in sustained numbers.
The surprising findings suggests the main reasons retailers are still skeptical about ordering online is because they don’t feel comfortable online, minimum order requirements and a lack of convenient deliver options.
Despite the figures, there remains a long-term move in favour of online/delivered routes to market, but many retailers have chosen to go to the depot to ensure availability for their customers.
Lumina’s study showed that, on average, more than half of a retailer’s stock is purchased from a wholesale depot with more than a quarter from wholesaler websites, with others coming from apps, supermarkets, online retailers and sales reps/vans.
“Digital investment is key for wholesalers, but they must understand the needs of retailers to maximise its potential,” said Senior Insight Manager Alice Dolling.
“Site taxonomy and ease of navigation are key to a positive user experience. Meanwhile, with more retailers conducting distress top up missions through the delivered channel, this could indicate an opportunity for a premium subscription for faster delivery or loyalty schemes offering a lower minimum order requirement.”
That trend doesn’t hold out across retail-to-consumer channels, though, with 7% of overall convenience store sales made digitally now – albeit only 8% of stores offer the service.
Demand has grown since the pandemic hit, with retailers offering services through third-party providers such as Snappy Shopper and Deliveroo, while others have set up their own.
“2020 saw an acceleration in online shopping that we could never have predicted,” Dolling added.
“Nearly one-in-five shoppers changed their primary method of grocery shopping to online, highlighting the opportunity available.
“As demand increases, convenience stores have a great opportunity to drive greater basket spend and expand the potential catchment area of their store by offering delivery.”
Get more information on the UK Wholesale Market Report 2020/21 on the Lumina Intelligence website.