Lumina Intelligence

Lumina Intelligence has launched its Future of Convenience Report 2021, which explores the consumer trends shaping the industry and how the convenience sector can leverage them in the future.

A large section of the report focuses on the legacies of 2020 and how post-pandemic behaviour will impact future shopper intentions.

The report highlights three key trends from 2020 – The suburban migration, expanding avenues and recessionary revivals.

The suburban migration is seen as one of the key changes caused by Covid-19. The report says pre-pandemic lifestyles centred around urban workplaces, global mindsets and inside living. The coronavirus pandemic saw these norms traded for home working, local living and a “chase for outdoor space” as city centre footfall plummeted. All of which is expected to continue into 2021:

  • 78% say it’s either “important” or “very important” to support local suppliers and retailers;
  • 53% have shopped locally more in the last year;
  • 42% will continue to shop locally in the future;
  • 74% say it’s either “important” or “very important” to support businesses who give back to the community.

Alice Dolling, senior insight manager at Lumina Intelligence, said: “Disrupted global supply chains and trade restrictions for businesses made local buying both a necessity and desire in 2020. This behaviour is expected to continue, with most consumers defining ‘local’ as ‘made in the UK’ – a trend that will be boosted by Brexit.

“Convenience store retailers are perfectly positioned to capitalise on the demand for shopping locally. Community involvement is pivotal in building loyalty and awareness. In fact, positive community involvement directly correlates with likelihood to recommend a store.”

The coronavirus pandemic has also increased demand for online shopping. But with demand for delivery from supermarkets outstripping supply during the spring, this opened new avenues for convenience stores and sparked growth in ‘On Demand Convenience’. Retailers also innovated with the introduction of bundle boxes and subscription offers, which are affordable and provide much needed inspiration and solutions for shoppers:

  • 18% of consumers have changed their primary method of grocery shopping to online in the last year;
  • 38% of consumers are not aware of convenience store delivery, however 48% would use it;
  • 27% would replace a takeaway with delivery from a convenience store.

Dolling added, “2020 saw an acceleration in online shopping that we could never have predicted. 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. Not only that, delivery provides another avenue to compete with foodservice operators in the ‘takeaway’ market.”

The pandemic also triggered a recession, and with the economic impact of the virus likely to be felt for many years, the report says retailers and suppliers should expect to see consumers demonstrating savvier shopping behaviour:

  • 61% are “very” or “extremely” aware of product prices in convenience stores;
  • 43% are “likely” or “highly likely” to join a loyalty scheme if it offered personalised offers;
  • 28% of shoppers purchase own label;
  • 46% either “agree” or “strongly agree” that they are trying to reduce their food and drink spend;
  • 66% either “agree” or “strongly agree” that they are more careful with what they spend money on than before lockdown began.

Dolling commented: “In April 2020, 37% of consumers said they were visiting their local convenience store more often, driven by government advice to ‘stay local’. The big challenge for retailers in 2021 will be to retain these shoppers.

“With the UK entering its first recession in 11 years, consumers will be more aware of their spending and will be engaging in price comparisons. Retailers and suppliers will inevitably have to be reactive with promotions, but also offer loyalty schemes to gain and retain shopper custom.”