Report Summary
The UK Department Stores market report identifies consumer attitudes towards retail offerings, services, and department store footfall in the UK. This market report covers the market size, market forecast, market segmentation and industry trends for the UK Department Stores market in the UK.
Current Market Landscape
Department stores have been rocked significantly by COVID-19, which has exacerbated many of the issues already facing the sector, such as increased online shopping and declining footfall. Fashion is the most important product category for most department store retailers. However fashion has also been one of the hardest-hit of all retail sectors by the pandemic, further weakening sales at the main retailers.
- 80% of those who shopped at a department store buying clothing, footwear and accessories.
- The value of the sector declined by 25% to £11 billion in 2020.
The closure of all Debenhams stores has removed a major player and further dented the sector’s value. While we expect department stores to see some growth over the next few years, particularly once international travel resumes, we will continue to see some erosion among the mid-priced chains.
Future Market Trends in UK B2B Economic Outlook
As the way people shop changes and pivot towards online continues, department stores face increased competition from cheaper and more flexible pureplays. Many fashion retailers have expanded their non-fashion offerings and added new home and beauty brands both online and in-store, putting them in direct competition with department stores.
Department stores will need to respond by widening and elevating the in-store services they offer. They can blend in-store experiences and online shopping through the use of the latest digital investments and tools, such as online personal styling parties via Zoom to create a standout shopping experience.
Read on to discover more details or take a look at all of our UK Retail market research.
Quickly understand
- The impact of COVID-19 on the department store sector.
- Changes in current shopping behaviour due to changing lifestyles and shift online.
- Levels of satisfaction with department stores and their retail offering and services.
- How department stores can use in-store experiences and services to drive footfall.
- Understanding why people are choosing other types of retailers over department stores.
Covered in this report
Brands: Harrods, Selfridges, Liberty, John Lewis & Partners, House of Fraser, M&S (Marks and Spencer), Debenhams, Beales, Fenwick, Harvey Nichols, Fortnum & Mason, W Boyes & Co, Morleys Stores, TJ Hughes, Oldrid & Co, Jarrold & Sons, Hoopers, WJ Aldiss, Barkers, Bradbeers.
Expert analysis from a specialist in the field
This report, written by Tamara Sender Ceron, a leading analyst in the Fashion sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.
Department stores have been rocked by COVID-19 and face increased competition from pureplays and fashion retailers expanding into new categories. They will need to respond by widening and elevating the in-store services they offer to encourage customers to visit stores, as well as making shopping easier by blending the in-store and online shopping experience through new digital investments.
Tamara Sender Ceron
Senior Fashion Analyst
Table of Contents
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Overview
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- Key issues covered in this Report
- COVID-19: Market context
- Economic and other assumptions
- Products covered in this Report
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Executive Summary
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- Impact of COVID-19 on department stores
- Figure 1: Short, medium and long-term impact of COVID-19 on department stores, 24 May 2021
- The market
- Sales plummet hit by store closures due to COVID-19
- Figure 2: UK department store sector size and forecast, best and worst-case scenario, 2016-26, prepared on 1 July 2021
- Companies and brands
- John Lewis grows its share
- Figure 3: Leading department stores, estimated market shares, 2018-20
- Online sales soar as stores close
- John Lewis is the most trusted, while Liberty perceived as fun
- Figure 4: Attitudes towards and usage of selected brands, 2020-21
- The consumer
- Big decline in department store usage
- Figure 5: Department stores used in the last 12 months, May 2019-May 2021
- 27% shop via a smartphone
- Figure 6: How shoppers have bought from department stores in the past 12 months, May 2021
- Big decline in purchasing of key fashion category
- Figure 7: What consumers bought from department stores in February 2021 and May 2021
- Range of brands/products entice shoppers
- Figure 8: How satisfied shoppers are with department stores, May 2021
- 25% use social media for help
- Figure 9: Current and future behaviours, May 2021
- Department stores should collaborate with local brands
- Figure 10: Consumers interest in innovations, May 2021
- Pureplays steal spend from shoppers
- Figure 11: Reasons for not shopping at department stores, May 2021
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Issues and Insights
- Impact of COVID-19 on the department store sector
- Closure of stores hits them hard
- Too reliant on fashion
- Weakened by collapse in international tourism
- Responding to shift online
- What are the main opportunities for growth for department stores?
- Expanding home categories
- Immersive in-store experiences
- Collaborations with unique brands
- Filling gap in the market left by Debenhams
- Impact of COVID-19 on the department store sector
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The Market – Key Takeaways
- Sales plummet hit by store closures due to COVID-19
- Reliance on fashion leads to losses
- Collapse in international tourism has detrimental impact
- Sales plummet hit by store closures due to COVID-19
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Market Size and Forecast
- Short, medium and long-term impact on department stores
- Figure 12: Short, medium and long-term impact of COVID-19 on department stores, 24 May 2021
- Department store sales plummet as stores suffer large losses
- Figure 13: UK department store sector size and forecast, best and worst-case scenario, 2016-26, prepared on 1 July 2021
- Figure 14: UK department store sector size and forecast, at constant and current prices, 2016-26, prepared on 1 July 2021
- Store closures have heavily impacted the market
- Market drivers and assumptions
- Figure 15: Key drivers affecting Mintel’s market forecast, 2015-25 (prepared on 1 July 2021)
- Forecast methodology
- Short, medium and long-term impact on department stores
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Consumer Spending
- COVID-19 causes declines across all categories
- Reliance on fashion leads to losses
- Home and garden emerges as one of the strongest categories
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- Figure 16: Consumer spending on the core department store categories, 2016-20
- COVID-19 causes declines across all categories
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Market Drivers
- Tourism
- Figure 17: Number of inbound tourists and tourist expenditure in the UK, 2009-20
- Brexit fears
- Figure 18: Brexit fears, 29 April-6 May 2021
- Footfall will be slow to recover
- Figure 19: Google COVID-19 Community Mobility Reports, UK (national), average monthly change, 15 February 2020-30 April 2021
- Online sales
- Figure 20: Internet sales as a proportion of total retail sales, 2010-20
- Tourism
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Companies and Brands – Key Takeaways
- John Lewis grows its share
- Debenhams moves fully online after acquisition by boohoo
- Online sales soar as stores close
- John Lewis grows its share
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Leading Players
- Note on department store sales
- Debenhams bought by boohoo, and M&S makes changes
- Figure 21: Leading department stores, net sales, 2016-20
- Frasers Group focuses on premium offerings
- Beales comes back after administration
- Figure 22: Leading department stores, outlet numbers, 2016-20
- John Lewis shutters stores as it suffers losses and focuses on online
- Figure 23: Leading department stores, operating profits, 2016-20
- Figure 24: Leading department stores, estimated sales per outlet, 2016-20
- Note on department store sales
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Market Share
- John Lewis grows its share, while Debenhams’ declines
- Figure 25: Leading department stores, estimated market shares, 2018-20
- Figure 26: Leading department stores, market shares, 2016-20
- John Lewis grows its share, while Debenhams’ declines
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Online
- Online sales soar as stores close
- Figure 27: Select leading department stores, estimated online revenues, 2016-20
- Online sales now make up three quarters of all John Lewis revenue
- Figure 28: Estimated online share of select leading department stores’ total revenues, 2016-20
- Figure 29: Estimated online department store market size, 2016-20
- Note on methodology
- Online sales soar as stores close
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Launch Activity and Innovation
- Department stores focus on in-store experiences
- Harrods opens beauty concept store at Intu Lakeside
- Figure 30: H Beauty store in Milton Keynes 2021
- Selfridges teams up with SoulCycle to open first Outside Studio
- Figure 31: SoulCycle Studio at Selfridges 2021
- John Lewis to roll out ‘hundreds’ of shop-in-shops inside Waitrose stores
- Department stores experiment with augmented reality technologies
- Liberty to offer virtual shopping experiences with Hero
- John Lewis trials augmented reality sofa
- Figure 32: John Lewis AR sofa feature 2020
- Retailers focus on expanding ecommerce capabilities
- John Lewis teams up with furniture rental service Fat Llama
- Figure 33: Fat Llama and John Lewis rental service 2020
- Fortnum & Mason launches high-end dinner delivery service
- Harrods offers remote personal shopping service for selected customers
- Department stores drive sustainability agendas
- Handbag Clinic launches partnership with Fenwick
- Fortnum & Mason launch ‘Hungry Minds’ podcast in digital push
- Figure 34: Fortnum & Mason podcast 2020
- Selfridges to sell vertically farmed produce from its own store
- Figure 35: Project Earth food edit 2020
- Launches
- House of Fraser launches ‘staying in-in’ collection
- Figure 36: House of Fraser’s In-In Collection 2020
- Harrods opens outlet at Westfield to help shift excess stock
- Figure 37: Harrods outlet at Westfield London
- John Lewis reveals own-brand label AnyDay
- Figure 38: John Lewis AnyDay range 2021
- Department stores focus on in-store experiences
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Advertising and Marketing Activity
- Ad spending significantly drops in 2020
- Figure 39: Recorded above-the-line, online display and direct mail total advertising expenditure by selected leading UK department stores, 2016-January-April 2021
- M&S top advertising spender in 2020
- Figure 40: Recorded above-the-line, online display and direct mail total advertising expenditure, by selected leading UK department stores, 2016-20
- Advertising moved indoors
- Figure 41: Recorded above-the-line, online display and direct mail total advertising expenditure by selected leading UK department stores, by media type, 2020
- Figure 42: Recorded above-the-line, online display and direct mail total advertising expenditure of selected leading UK department stores, by media type, 2020
- Key campaigns
- Retailers launch anticipated Christmas adverts
- Figure 43: Waitrose & Partners Christmas advert, 2020
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- Figure 44: A Very British Bear advert 2020
- Figure 45: M&S Christmas advert 2020
- Selfridges launches Project Earth campaign
- Figure 46: Selfridges Project earth campaign 2020
- M&S ‘Remarksable’ campaign
- Figure 47: M&S Remarksable campaign 2020
- Nielsen Ad Intel coverage
- Ad spending significantly drops in 2020
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Brand Research
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- Brand map
- Figure 48: Attitudes towards and usage of selected brands, 2020-21
- Key brand metrics
- Figure 49: Key metrics for selected brands, 2020-21
- Brand attitudes: Selfridges provides a great online service
- Figure 50: Attitudes, by brand, 2020-21
- Brand personality: Liberty perceived as fun
- Figure 51: Brand personality – Macro image, 2020-21
- John Lewis seen as responsive
- Figure 52: Brand personality – Micro image, 2020-21
- Brand analysis
- Selfridges perceived as fun
- Figure 53: User profile of Selfridges, 2021
- Liberty needs to do more to raise brand awareness
- Figure 54: User profile of Liberty, 2021
- John Lewis & Partners is a favourite brand
- Figure 55: User profile of John Lewis & Partners, 2020
- Harrods seen as diverse
- Figure 56: User profile of Harrods, 2021
- House of Fraser needs to do more to stand out
- Figure 57: User profile of House of Fraser, 2021
- Reading word clouds
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The Consumer – Key Takeaways
- Big decline in department store usage
- Reliance on fashion hurts department stores
- Department stores should collaborate with local brands
- Big decline in department store usage
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Impact of COVID-19 on Consumer Behaviour
- Consumers shop more online
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- Figure 58: Changes to consumer habits due to COVID-19, 10-18 June 2021
- Shoppers enjoy a day out shopping as non-essential retail reopens
- Figure 59: Activities done in the last week by consumers, 10-18 June 2021
- Shoppers spend less on clothing and accessories
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- Figure 60: Consumers’ shopping habits due to COVID-19, 10-18 June 2021
- Consumers shop more online
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Where They Shop
- Big decline in department store usage
- Figure 61: Department stores used in the last 12 months, May 2019-May 2021
- John Lewis’s focus on ecommerce capabilities pays off
- Figure 62: Department stores used in-store and online in the last 12 months, May 2021
- 16-34s keen department store shoppers
- Figure 63: Who buys from department stores, by age group, May 2021
- ABs favour department stores
- Figure 64: Department stores used in-store and online in the last 12 months, by socio-economic groups, May 2021, % who bought from the following department stores
- Most are loyal to one retailer
- Figure 65: Repertoire of how many department stores they shop at, May 2021
- Big decline in department store usage
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How They Shop
- 27% shop via a smartphone
- Figure 66: How shoppers have bought from department stores in the past 12 months, May 2021
- 16-34s favour shopping via a smartphone
- Figure 67: How shoppers have bought from department stores in the past 12 months, May 2021
- 27% shop via a smartphone
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What They Buy
- Big decline in purchasing of key fashion category
- Figure 68: What consumers bought from department stores in February 2021 and May 2021
- Furniture popular as shoppers spend more time at home
- Appealing to older shoppers
- Figure 69: What consumers bought from department stores in the last 12 months, May 2021
- A third buy one type of product at department stores
- Figure 70: Repertoire of what they buy, May 2021
- Big decline in purchasing of key fashion category
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Satisfaction with Department Stores
- Range of brands/products entice shoppers
- Figure 71: How satisfied shoppers are with department stores, May 2021
- Dealing with issues of product availability
- 34-54s happy with online services at department stores
- Figure 72: How satisfied shoppers are with department stores online services, by age group, May 2021
- Shoppers engage with store environments
- Figure 73: How satisfied shoppers are with department stores’ store environments, by age group, May 2021
- Range of brands/products entice shoppers
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Current and Future Behaviour of Department Store Shoppers
- Adapting click-and-collect
- Figure 74: Current and future behaviours, May 2021
- 16-34s use social media for help
- Figure 75: Current and future behaviours, by age group, May 2021
- Males interested in attending an online event
- Figure 76: Consumers who would be interested in the following, by gender, May 2021
- Adapting click-and-collect
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Interest in In-Store Innovations
- Contactless shopping appeals to shoppers
- Figure 77: Consumers interest in innovations, May 2021
- Repair stations appeal to a quarter of shoppers
- Department stores should collaborate with local brands
- Figure 78: Consumers interest in innovations, by age group, May 2021
- Contactless shopping appeals to shoppers
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Reasons for Not Shopping at Department Stores
- Online-only retailers steal spend from shoppers
- Figure 79: Reasons for not shopping at department stores, May 2021
- Shoppers cut back on discretionary spending
- Online-only retailers steal spend from shoppers
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Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
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Appendix – Market Size and Forecast
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- Figure 80: UK department store sector size and forecast, best and worst-case scenario, 2016-26, prepared on 1 July 2021
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About the report
This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.
Market
Mintel provides a range of market information, frequently through the category level, including market size and forecasting, complete with market drivers that illustrate the forces that shape a category or market.
Consumer
Mintel’s proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.
Brand/Company
Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.
Data
Market reports provide appendices of data to support the research and insight produced. Our databooks* are easily manipulated and downloadable to support your research needs and covers factors from consumer attitudes to market forecasts.
*databooks not available with UK B2B Industry reports.
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