Despite a heavily changing retail landscape and restricted movement over the most recent financial year, things are looking up for the convenience channel.
By IRI Consultant Dr Kate Hardwick.
The end of the 2021 financial year marked the 16th month of our ‘new normal’ that brought a major decline in travel, diminished socialising and negligible window shopping, all of which contributed to a significant reduction in some retail sectors.
Reduced travel and spending more time at home than ever shrank consumers’ opportunity to pop into a convenience store for that inevitable sugar boost or grabbing the bread and milk on the way home from work. Yet in the face of these changing shopping conditions, varied lifestyles and numerous lockdowns, in the MAT (ending 4/7/21), convenience channels have seen a value uplift of 6.4 per cent.
In April 2020, consumer confidence indices hit their lowest point since the global financial crisis (GFC) in 2008. However, confidence bounced back much faster than in the post-GFC rebound. As such, the economy has not been impacted in quite the same way as when the GFC hit, but that’s not to say the economy was not impacted. Australia’s two most populated states experienced extensive lockdowns in 2020 and 2021, causing a strong shift from bricks and mortar to e-commerce. In the grocery sector, increased online sales continued strongly, but so did bricks and mortar shopping once lockdowns were lifted. Considering the nature of convenience channels, this sector did not shift online. Instead, it continues to rely on foot traffic, and this year brought positive jumps in unexpected areas.
Read more about the changing retail landscape and the convenience channel in the latest issue of Convenience World.