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Shopping Locations - UK - June 2016

“As retailers endeavour to keep up with evolving consumer shopping habits, the challenges facing the retail market are as apparent as ever. Online continues to grow its share of retail sales, however stores remain integral to the purchase process and there are opportunities for shopping locations to tap into the growing spend on leisure, while using digital technology to merge the offline and online experience.”
– Alice Goody, Retail Analyst

This report examines the following areas:

  • Retail locations – How have they fared?
  • The opportunities for the high street
  • Offline vs online retailing: the digital opportunity

Although high streets have been facing competition from the out-of-town developments, several consumer trends offer potential for these local centres going forward. They are the most likely to benefit from the aging population, yet they are also well placed to take advantage of the convenience shopping habits of the young.

The retail locations used in this report are based on the different types of shopping mission.

Local centres – small high streets and neighbourhood stores. These are small centres, primarily for top-up shopping and satisfying immediate needs. So they include everything from corner shops through to small high streets which we think need to be developed as local centres. Such high streets have very few multiples.

Major centres – city centres and major shopping centres such as Bluewater or Westfield. These centres are for big shopping trips when a large selection of major multiples is wanted. They are the place for comparison shopping and have department stores and major multiples including Marks & Spencer (M&S).

Retail parks – collections of out-of-town non-food superstores. Typically, these contain furniture, electricals and DIY retailers. But they can also have retailers such as M&S, Next and Boots in them.

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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this report
      • Executive Summary

          • The market
            • Consumer sentiment trends upwards
              • Aging population could benefit high streets
                • Falling vacancies at retail parks
                  • Rebirth of Cities
                    • Access All Areas
                      • Shopping locations in context
                        • Retail innovation
                          • The consumer
                            • Grocery superstores the most visited location
                              • Figure 1: Shopping locations used in the last six months, April 2016
                            • Four in 10 shopping online more often
                              • Figure 2: Changes in shopping habits, April 2016
                            • High streets need better family-focused leisure facilities
                              • Figure 3: Satisfaction with local town centre/high street, April 2016
                            • Digitising the shopping experience
                              • Figure 4: Interest in digital innovations while shopping, April 2016
                            • Experiences can drive consumers to shopping locations
                              • Figure 5: Attitudes towards shopping locations, April 2016
                            • What we think
                            • Issues and Insights

                              • Retail locations – How have they fared?
                                • The facts
                                  • The implications
                                    • The opportunities for the high street
                                      • The facts
                                        • The implications
                                          • Offline vs online retailing: the digital opportunity
                                            • The facts
                                              • The implications
                                              • The Market – What You Need to Know

                                                • Consumer sentiment trends upwards
                                                  • Aging population could benefit high streets
                                                    • Falling vacancy rates at retail parks
                                                      • Growth in rented households
                                                        • Rebirth of Cities
                                                          • The retail market
                                                          • Market Drivers

                                                            • Consumer sentiment trends upwards
                                                              • Consumers splash out on leisure over retail
                                                                • Aging population could benefit high streets
                                                                  • High demand for space at retail parks
                                                                    • Shop prices deflate in 2015
                                                                      • Figure 6: Shop prices year on year, February 2015- February 2016
                                                                    • Growth in rented households
                                                                      • Figure 7: Proportions of households renting, 2006-15
                                                                    • Cost of fuel drops
                                                                      • Government postpones business rates review
                                                                      • Shopping Locations in Context

                                                                        • Trends in the marketplace
                                                                          • Rebirth of Cities
                                                                            • Access All Areas
                                                                              • Alternative Realities
                                                                                • The retail market by type of retailer
                                                                                  • Figure 8: Structure of UK retailing (excluding fuel), 2015
                                                                                • The retail market by location
                                                                                  • Figure 9: Retail market structure (inc vat), 2010/11-2014/15
                                                                                • Top 10 shopping centres
                                                                                  • Figure 10: Top 10 shopping centres in the UK, 2016
                                                                                • Top 10 factory outlet centres
                                                                                  • Figure 11: Top 10 factory outlet centres in the UK, 2016
                                                                                • Top 10 retail parks
                                                                                  • Figure 12: Top 10 retail parks in the UK, 2016
                                                                              • Online – Segmentation by Product Category

                                                                                • Year-on-year online growth slows
                                                                                  • Figure 13: Online sales as a proportion of total retail sales, January 2014-April 2016
                                                                                • Electricals take the greatest share of online sales
                                                                                    • Figure 14: Breakdown of online retail sales by major category (incl. VAT), 2014-2016 (est)
                                                                                  • Online market evenly split between pure players and store-based retailers
                                                                                    • Figure 15: Online sales by type of retailer, 2015
                                                                                    • Figure 16: Store based and pure player share of all online sales, 2008-2016
                                                                                  • Review of major product categories
                                                                                    • Electrical goods
                                                                                      • Clothing and footwear
                                                                                        • Grocery
                                                                                        • Retail Innovation

                                                                                          • Merging online and offline retail
                                                                                            • Sephora’s digitally driven store
                                                                                              • Heal’s connects online shoppers with store staff using smart glasses
                                                                                                • House of Fraser’s shoppable Black Friday store windows
                                                                                                  • Interesting experiences in the retail environment
                                                                                                    • intu Lakeside to launch Nickelodeon-themed entertainment centre
                                                                                                      • Apple offers free art classes for all in store
                                                                                                        • Samsung’s flagship store is an “immersive cultural centre”
                                                                                                          • Story acts more like a magazine and gallery than a shop
                                                                                                            • Supermarkets prolong dwell time in superstores
                                                                                                                • Figure 17: The wine bar at Waitrose’s ‘Food & Home’ shop concept in Salisbury, 2015
                                                                                                              • Retailers experiment with foodservice offering
                                                                                                                • Figure 18: Thomas’s café at Burberry’s Regent Street flagship, 2015
                                                                                                              • Pure plays move into physical space
                                                                                                                • Birmingham benefits from Grand Central opening
                                                                                                                • The Consumer – What You Need to Know

                                                                                                                  • Grocery superstores the most visited location
                                                                                                                    • Four in 10 shopping online more often
                                                                                                                      • Young consumers are shopping more in cities and at the major malls
                                                                                                                        • Dissatisfaction towards local high streets
                                                                                                                          • Under-45s engaged with mobile innovations
                                                                                                                            • Demand for more varied food options while shopping
                                                                                                                              • Shoppers trust customer reviews more than staff
                                                                                                                              • Shopping Location Usage

                                                                                                                                • Majority of consumers still visit a grocery superstore
                                                                                                                                  • Figure 19: Shopping locations used in the last six months, April 2016
                                                                                                                                • Who shops where?
                                                                                                                                  • Local centres can tailor themselves to needs of older shoppers
                                                                                                                                    • Figure 20: Shopping locations visited/used in the last six months, by age, April 2016
                                                                                                                                  • Families over-represented at retail parks
                                                                                                                                    • Londoners have lowest superstore usage
                                                                                                                                      • Figure 21: Shopping locations visited/used in the last six months, by region, April 2016
                                                                                                                                    • Outlet villages appeal to high earners
                                                                                                                                        • Figure 22: Usage of outlet villages in the last 6 months, by gross annual household income and region, April 2016
                                                                                                                                    • Changes in Shopping Habits

                                                                                                                                      • Four in 10 shopping online more often
                                                                                                                                        • Figure 23: Changes in shopping habits, April 2016
                                                                                                                                      • Young women shopping more at the major malls
                                                                                                                                        • Figure 24: Consumers that are using the shopping locations more than a year ago, by age, April 2016
                                                                                                                                      • 35-44s frequent outlet villages more often
                                                                                                                                        • Convenience stores retain their popularity
                                                                                                                                          • Figure 25: Changes in usage of shopping locations/services, April 2016
                                                                                                                                        • Opportunity to increase click-and-collect usage
                                                                                                                                          • Shoppers opt for coffee shops and cafés over restaurants
                                                                                                                                            • Figure 26: Changes in usage of dining outlets while on a shopping trip, April 2016
                                                                                                                                        • Satisfaction with Shopping Locations

                                                                                                                                          • Where do people shop most often for non-food?
                                                                                                                                            • Figure 27: Location used most often for non-food purchases, versus locations used in the last 6 months, April 2016
                                                                                                                                          • How satisfied are shoppers with their regularly used location?
                                                                                                                                            • Figure 28: Dissatisfaction with shopping location used most often for non-food purchases, April 2016
                                                                                                                                          • High streets need better family-focused leisure facilities
                                                                                                                                              • Figure 29: Satisfaction with local town centre/high street, April 2016
                                                                                                                                            • Retail parks benefit from parking availability
                                                                                                                                              • Figure 30: Satisfaction with retail parks, April 2016
                                                                                                                                            • Superstores could benefit from gym tie-ups
                                                                                                                                              • Figure 31: Satisfaction with grocery superstores, April 2016
                                                                                                                                            • Overall satisfaction levels high
                                                                                                                                              • Figure 32: Overall satisfaction with location used most often for non-food purchases, April 2016
                                                                                                                                          • Key Driver Analysis – Shopping Locations

                                                                                                                                            • Methodology
                                                                                                                                              • Shopping locations need to monitor their leisure facilities
                                                                                                                                                • Figure 33: Key drivers of overall satisfaction with most often visited shopping location for non-food purchases, April 2016
                                                                                                                                                • Figure 34: Overall satisfaction with most often visited shopping location for non-food purchases - key driver output, April 2016
                                                                                                                                            • Interest in Digital Innovations

                                                                                                                                                • 43% want free Wi-Fi while shopping
                                                                                                                                                  • Under-45s most engaged with mobile innovations
                                                                                                                                                    • Figure 35: Interest in digital innovations while shopping, April 2016
                                                                                                                                                  • A fifth of under-35s willing to give email address for digital receipt
                                                                                                                                                    • Figure 36: Interest in digital innovations while shopping, by age, April 2016
                                                                                                                                                • Attitudes towards Shopping Locations

                                                                                                                                                  • Demand for more varied food options while shopping
                                                                                                                                                    • Figure 37: Attitudes towards dining out at shopping locations, April 2016
                                                                                                                                                  • Four in 10 Londoners show interest in in-store classes
                                                                                                                                                    • Figure 38: Attitudes towards loyalty and experiences at shopping locations, April 2016
                                                                                                                                                  • Opportunity to bring online reviews into the store environment
                                                                                                                                                    • Figure 39: Attitudes online vs offline shopping, April 2016
                                                                                                                                                • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                                  • Definition
                                                                                                                                                    • Financial data
                                                                                                                                                      • Abbreviations
                                                                                                                                                        • Consumer research methodology
                                                                                                                                                          • Key driver analysis
                                                                                                                                                            • Interpretation of results
                                                                                                                                                              • Figure 40: Overall satisfaction with most often visited shopping location for non-food purchases - key driver output, April 2016
                                                                                                                                                              • Figure 41: Satisfaction with most often visited shopping location for non-food purchases, April 2016
                                                                                                                                                            • Structure of UK retailing (excluding fuel) classifications

                                                                                                                                                            Companies Covered

                                                                                                                                                            To learn more about the companies covered in this report please contact us.

                                                                                                                                                            Shopping Locations - UK - June 2016

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