Despite the rapid growth of online shopping, in-store remains the dominant channel in UK retail, accounting for 71.8% of all retail sales in 2023. In-store sales have suffered from the accelerated maturity caused by the pandemic, with share down from 78.2% in 2019, however, these numbers highlight the enduring importance of physical retail spaces.
A key challenge facing physical trading is the perception of the convenience of shopping in-store, with online seen by many as the easiest way to shop. An element of this perception is based on accessibility issues, and with 71% of in-store shoppers indicating that free parking would entice more frequent visits, making it easier and more convenient to visit shopping sites is key.
With shopping locations still viewed by the majority of consumers as critical features of their community and important socialising destinations, retail has to first look inward for answers. Poor availability, lacking store-standards and sub-par service has also contributed to the view that online shopping is more convenient. The positive is that with online sales growth slowing, the time is now for retailers to reassert and reinvest in the physical format, creating experiences that are fit for the modern age and highlight to a new generation that retail can be once again the cornerstone of the high street.
This report looks at the following areas:
- The size and five-year forecast for in-store retail sales, the impact of online growth on in-store trading, and how multi-channel retailers are utilising the respective channels.
- Shopping location visitation, including frequency and purpose, with a focus on what draws shoppers to their preferred shopping location.
- The perceived strengths of shopping in-store versus online, and key areas which shoppers want to see improvement in when shopping in-store, and innovations seen within the in-store shopping experience.
- The features most noticed when shopping in-store, such as cleanliness and availability, and how these impact store choice and willingness to come into store.
- Attitudes towards barriers to shopping in-store, technological integration, service and social shopping.
After a long period of greater investment in the online channel, multi-channel retailers need to recognise the importance of stores and ensure ongoing investment to meet modern shopper needs.
Nick Carroll, Director of Retail Insight
Market Definitions
For the purposes of this Report, Mintel has used the following definitions:
This Report examines the UK market for over-50s life insurance, a specific type of whole-of-life insurance, also referred to as guaranteed acceptance whole-of-life insurance or, simply, over-50s plans or guaranteed acceptance plans.
Policies are designed to pay out a fixed tax-free cash sum (or ‘benefit amount’) on death after a qualifying period (typically the first 12 or 24 months). However, most policies provide immediate cover for accidental death, and many will pay back premiums if the person dies for any reason other than accidental death during this qualifying period.
Cover is offered on a guaranteed acceptance basis, meaning no medical or health information is required, although the applicant usually needs to declare whether or not they smoke. They are typically designed for people aged between 50 and 80, although some providers have an upper age limit of 85 (eg Direct Line) and even 90 (eg One Family).
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Executive Summary
- Opportunities for in-store retailing
- Embrace the social shopping experience
- The best case for retail needs to be made within the sector
- Create stores that modern shoppers want to spend time in…
- …and get serious about service standards
- Market dynamics and outlook
- Market size & forecast
- In-store sales outpace the market in 2023
- Graph 1: all estimated in-store retail sales (excluding fuel, including VAT), market size and growth in value terms, 2019-24
- In-store sales forecast to be worth £366.9bn by 2029
- …by the end of the decade over two-thirds of sales in the retail sector will still come in-store
- Graph 2: estimated and forecast share of all retail sales, by major channel, 2019-2029
- Day-to-day confidence remains shaky but there are some positive signs of recovery
- Graph 3: the financial wellbeing index, 2018-24
- What consumers want and why
- Over half of consumers have visited a major shopping centre in the past six months
- Graph 4: shopping locations visited in the last six months, 2024
- Local destinations show the most frequent visitation
- Graph 5: frequency of shopping location visitation in the last six months, 2024
- Small minority using physical retail locations to only support online shopping behaviours
- Graph 6: “have you purchased products in-store in the last six months?”, 2024
- Convenience is critical for visiting shopping locations
- Graph 7: reasons for visiting a shopping location most frequently in the past six months, 2024
- Socialising and ‘out of home’ time still an important driver for locations
- Graph 8: “visiting a shopping location is a good way to socialise with my friends/family”, by age , 2024
- Store standards critical to maintain a key benefit of the physical experience
- Graph 9: perceived benefits of shopping in-store versus shopping online, 2024
- Service has to be invested in with younger consumers most appreciative of good service
- Stronger interest for in-store technology integration from younger shoppers
- Graph 10: interest in in-store technology, 2024
- Availability leaves a lasting impression on shoppers
- Graph 11: features noticed when shopping in-store, overall ranking, 2024
- Over a quarter have not come into store due to a lack of live-stock
- Graph 12: attitudes towards live stock and reserve and collect, by age, 2024
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Market Dynamics
- Market drivers
- Day-to-day confidence remains shaky
- Graph 13: the financial wellbeing index, 2018-24
- Polarisation in financial position is being amplified
- Graph 14: “How does your own financial situation compare to how it was a year or so ago?”, 2024
- Consumers are slightly more confident about the future
- Graph 15: the financial confidence index, 2016-24
- Inflation has eased, but remains the key pressure on finances
- Deflation has entered select categories, but the overall story is of added cost…
- Graph 16: CPI inflation and key retail categories, 2021-24
- …which is being eased by a year of real income growth
- Graph 17: real incomes, CPIH versus average weekly earnings, 2019-24
- Shifts in consumer spending
- Consumer spending on retail goods falls following recent peak
- Spending on retail goods accounts for just under a third of total consumer spending
- Graph 18: breakdown of total consumer spending, in value terms by major category as a % of total, 2000-23
- Spending on services has outpaced retail in the recent period
- Retail demand has grown ahead of population growth over the past 23 years
- Graph 19: compound annual growth rate of major categories of total consumer spending (value and volume), 2000-23
- Vets and pet services has been the quickest growing area…
- …aligning with an uptick in retail demand
- Graph 20: compound annual growth rate of consumer spending, value and volume, on select high street services, 2000-23
- Food and drink remains the largest area of retail spending…
- …however health and beauty has seen the strongest growth during the recent period
- Graph 21: retail goods, major categories as a % of total (value) spending, 2000-23
- Graph 22: retail goods, major categories as a % of total (volume) spending, 2000-23
- Retail sales performance
- Retail sales see ten-year high growth in 2023
- Graph 23: all retail sales (excluding fuel, including VAT), market size and growth in value terms, 2019-24
- Elements of volume growth return in 2024…
- Graph 24: all retail sales (excluding fuel, including VAT), value and volume growth, 2023-24
- …but financial pressure continues to pressurise underlying demand
- Total volume sales fall by 0.4% in the first half of 2024
- Graph 25: retail sales (excluding fuel, including VAT), volume growth, by category, 2019-24
- Store-based non-food sector squeezed by online growth
- Graph 26: share of all retail sales, by type of retail operation, 1995-2023
- Specialists operating in sectors with highest online penetration have been hardest hit
- Big ticket home and health and beauty specialists show resilience in the modern retail landscape
- Graph 27: major store-based non-food retailer categories, as a percentage of all store-based non-food retail sales, 1995-2023
- Store-based electrical sector has consistently shrunk since 2010
- Graph 28: compound annual growth rate of major store-based non-food specialist retail sectors, 2010-23
- The modern retail landscape
- Majority of retail spend still comes in-store
- Online sales estimated to account for 26.8% of all retail sales in 2024
- Graph 29: online sales as a proportion of all retail sales, 2020-29
- Online is a challenge to physical stores…
- …however for many it supports the physical network
- Graph 30: share of online sales, by type of retail operation, 2021-24
- Rise in online-only businesses a challange for pureplay retailers as well as the high street
- New online-only operations compounding this issue
- Graph 31: average transaction value (ATV), TikTok Shop versus leading marketplaces, 2023-24
- Slowing online growth cannot mask the scars left on many high streets…
- …and the case for support of physical retail needs to be made
- Market size
- Stores still account for the majority of sales within the UK retail sector
- In-store sales outpace market in 2023
- Graph 32: all estimated in-store retail sales (excluding fuel, including VAT), market size and growth in value terms, 2019-24
- Stores claim the highest share of sales during the summer months
- In-store share of sales drops back a little in the first half of 2024
- Graph 33: share of total retail sales, by store and non-store sales, 2023-24
- Stores continue to hold the majority of non-food demand…
- Graph 34: estimated sales of non-food retailers, by channel, 2018-2023
- …but the online uptick during Black Friday brings near parity between channels
- Graph 35: share of non-food retail sales, by store and non-store sales, 2023-24
- Market forecast
- Steady but unspectacular growth estimated for UK retail
- All retail sales in the UK to reach half a trillion by 2027
- Non-store to remain the growth area of UK retail
- In-store sales forecast to hit £366.9bn by 2029
- In-store sales worth an estimated £334 bn in 2024
- While share is moving away it is critical to remember….
- …by the end of the decade over two-thirds of sales in the retail sector will still come in-store
- Graph 36: estimated and forecast share of all retail sales, by major channel, 2019-29
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What Consumers Want and Why
- Shopping location visitation
- 47% visit a shopping location weekly
- Over half of consumers have visited a major shopping centre in the past six months
- Graph 37: shopping locations visited in the last six months, 2024
- Local destinations show the most frequent visitation
- Graph 38: frequency of shopping location visitation in the last six months, 2024
- Small minority using physical retail locations to only support online shopping behaviours
- Graph 39: “have you purchased products in-store in the last six months?”, 2024
- Major shopping locations attracting a younger and slightly more affluent audience
- Graph 40: demographic profile of shopping location visitation, by age and household income, 2024
- Younger consumers are typically more frequent visitors
- Graph 41: frequency of shopping location visitation in the last six months, by age, 2024
- Physical locations need to do more to speak to the needs of older shoppers…
- …with tailored formats a growing opportunity
- Reasons why a shopping location is visited most frequently
- Location and convenience drivers of visitation
- Convenience is critical for visiting shopping locations…
- Graph 42: reasons for visiting a shopping location most frequently in the past six months, 2024
- The basics must be in place for the high street to thrive
- For younger consumers food-service options are more important than retail options…
- Access is less of an issue for younger consumers, if the mix is right
- Graph 43: reasons for visiting a shopping location most frequently in the past six months, by age, 2024
- Younger men in particular are driven by food and drink service at shopping locations
- Graph 44: reasons for visiting a shopping location most frequently in the past six months, by age and gender, 2024
- Graph 45: reasons for visiting a shopping location most frequently in the past six months, by age and gender, 2024
- For young families the retail mix remains the primary driver of patronage…
- …with socialising and ‘out of home’ time still an important driver for locations
- Graph 46: “visiting a shopping location is a good way to socialise with my friends/family”, by age, 2024
- Create fast and slow shopping periods to appeal to differing needs
- Some brands can justify crowds, but day-to-day a majority want a quieter experience
- The benefits of shopping in-store
- Convenience means much of the pre-purchase journey has moved to the online channel
- Graph 47: convenience of shopping online for products compared to in-store, 2024
- Store standards critical to maintain a key benefit of the physical experience
- Graph 48: perceived benefits of shopping in-store versus shopping online, 2024
- Immediate satisfaction is still a perk of physical shopping…
- …but quicker and new forms of delivery are expanding…
- Graph 49: select factors which make in-store shopping better than online, by working location, 2024
- …threatening this USP in the long-term
- Service has to be invested in…
- …with younger consumers most appreciative of good service
- Graph 50: select factors which make in-store shopping better than online, age, 2024
- Give staff more information to work with
- The store of the future will play a crucial role in service
- Half of younger consumers would be interested in a store ‘recognising’ them
- Graph 51: attitudes towards technology when shopping in-store, by age, 2024
- Emerging technologies will let retailers provide more one-to-one service
- What consumers notice when in-store
- Availability leaves a lasting impression on shoppers
- Graph 52: features noticed when shopping in-store, overall ranking, 2024
- A quarter ranked availability as the factor they are most likely to notice
- Graph 53: features noticed when shopping in-store, by rank, 2024
- If availability issues are not addressed shoppers will take it into their own hands
- Over a quarter have not come into store due to a lack of live-stock
- Graph 54: attitudes towards live stock and reserve and collect, by age, 2024
- Sensory elements most likely to be noticed by younger shoppers…
- Graph 55: features noticed when shopping in-store, overall ranking by age, 2024
- …but so is a basic of store standards
- Need for a pleasant shopping environment will continue to rise up the agenda
- Physical can cut through the noise of digital browsing
- Retail media: who is it serving?
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Retailer activity
- The foundations of a successful physical format
- In-store services
- In-store services can be a key purchasing driver
- Retailers spotlight sustainability services in stores
- Boots rolls out NHS Pharmacy First service to stores
- Tesco opens salad bar inspired by TikTok
- Personalisation services a stand-out feature for new store openings in 2024
- Selfridges launches dedicated salon for textured hair
- Holland & Barrett trials new barista-made ‘H&Bean’ drinks in central London store
- In-store service
- Leverage expert staff to build trust and loyalty
- Expert-led customer service is a key driver for shopping in store
- Liverpool One launches AI assistant Liv
- Currys becomes first Microsoft retail repair partner in the UK
- Superdrug helps vision impaired customers to read product information
- AI lends a helping hand to grocers
- Multi-channel integration
- Mirror online shopping habits in-store for a seamless shopping experience
- Click-and-collect eases stock availability concerns
- Leverage loyalty schemes in store to blend the digital with the physical
- Retailers launch interactive in-store promotions with brands
- Unilever launches #CleanTok in Asda
- QR codes in aisles can inspire and educate shoppers
- Currys expands accessibility trial to London stores
- Range
- Spotlight products exclusively available in store
- Retailers spotlight inclusive product ranges in store
- Retailers promote independent brands and local community
- Waitrose launches GAIL’s takeaway bakery in store
- Buy Women Built and Whole Foods Market champion female founders in exclusive collaboration
- Retailers expand third-party offering
- Store design
- Store layout matters
- Retailers make shopping in store a sensory experience
- Theft mitigation from grocers
- Asda trials digital touchscreens for its spirits
- Retailers trial digital screens in store
- Retailers design stores with atmosphere at front of mind
- Grocers help make store  environments peaceful and safe
- Experience
- Create an immersive in-store shopping experience
- Stores become spaces for entertaining
- Retailers roll out beauty experiences
- Innovative and interactive product displays encourage discovery
- Selfridges launches experience-led pop-ups for its Summer of Sport campaign
- EE reveals new Bristol experience store
- Shopping location innovations
- Give shoppers more reasons to visit physical shopping locations
- Direct-to-consumer brands open physical stores
- Battersea Power Station opens Botanical Atelier embroidery pop-up
- John Lewis opens 1864 Rooftop Bar & Kitchen at Oxford Street store
- Mango rolls outits teen concept to the UK
- Physical shopping destinations increase access to independent businesses
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Appendix
- Supplementary data
- Consumer spending categorisation
- COICOP classifications
- Market forecast data and methodology
- All retail sales: market size and forecast
- All retail sales: market forecast and prediction intervals
- All in-store retail sales: market size and forecast
- All in-store retail sales: market forecast and prediction intervals
- All non-store retail sales: market size and forecast
- All non-store retail sales: market forecast and prediction intervals
- Forecast methodology
- Report scope and definitions
- Market definition [example]
- Abbreviations and terms
- Methodology
- Consumer research methodology
- Snoop SpendMapper methodology
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