RXUK TOP500 2020 v2

RXUK
TOP500
In partnership with
UK TOP500 REPORT 2020

A performance ranking of the largest ecommerce and
multichannel retailers in the UK
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INTRODUCTION
From the editor-in-chief

Welcome to the RetailX Top500 2020 report by adapting and developing the way that they
where this year we’re marking a change of sell, whether that’s through stores, through
name from the InternetRetailing Top500. the seamless service that they now offer on
The change recognises and reflects the part mobile or through improved merchandising,
that InternetRetailing’s research arm RetailX delivery and sustainable packaging options. In
plays in this annual listing of the leading previous years, we’ve seen a minority of top
multichannel and ecommerce retailers selling retailers work to improve their multichannel
in the UK. We believe this sixth annual report, offerings, while the average retailers lagged
as with its predecessors, stands apart from the behind. This year that seems to be changing
crowd in its performance-led analysis of how as a majority of businesses improve their
leading retailers sell in the UK. The research performance in ways that their customers will
starts with a Footprint ranking based on size appreciate. Even though much remains to be
- of revenues, store networks and web traffic done that general improvement in the wider
- before moving on to analyse that footprint in market makes the performance of this year’s
terms of performance through six Performance Elite retailers all the more impressive. Our
Dimensions: Strategy & Innovation, The warm congratulations to our Elite retailers of
Customer, Merchandising, Brand Engagement, 2020: Amazon, Argos, Dunelm, John Lewis,
Operations & Logistics and Mobile & Cross- Marks & Spencer and Next.
channel. This approach enables us to judge and
rank retailers on how well they perform day-to-
day in the UK’s changing retail market.
In last year’s report, we said that the retail
market continued to be turbulent – and so it
proved. Uncertainty around Brexit meant that
we saw two different days on which the UK
might have left the European Union without a
deal, a change of Prime Minister and, to end
the year, a general election. But the uncertainty
continues this year, with retailers still not clear
on exactly what Brexit will mean for them. At
the same time, traders continue to respond
as the way shoppers buy continues to change.
Customers are now much more willing to buy
more products online – but at the same time
they remain uncertain about whether they can
afford to buy. Thousands of shops are expected
to close over the coming year in what has been
described as a retail crisis, while shoppers
may also be responding to calls for increased
sustainability in the light of climate change.
But in 2020, this report suggests, retailers
appear to be responding at this time of change
© 2020 retailx.net, distributed by InternetRetailing.net February 2020 3

OUR METRICS
OUR METRICS
Our research covered seven Performance Dimensions (see page 44 for more details):
TABLE 1. OUR METRICS

0. FOOTPRINT:
UK retail turnover, ecommerce turnover, web reach and store estate of retail businesses give the ‘heft’ and a preliminary rank. We then
modify and weight that analysis through consideration of the following Dimensions:
1. STRATEGY & INNOVATION:
the extent to which the retailer is adapting for growth, international commerce and customer responsiveness
2. THE CUSTOMER:
measuring the experience from the customer’s point of view
3. OPERATIONS & LOGISTICS:
delivery, returns, collections
4. MERCHANDISING:
displaying and describing products
5. BRAND ENGAGEMENT:
making their brands familiar to the customer and connecting with them
6. MOBILE & CROSS-CHANNEL:
beyond single ecommerce or store channels
Performance clusters beyond their variation in size, reach We are grateful to SimilarWeb
We’ve ranked the UK Top500 and turnover. Throughout 2019, we for sharing data on the visits and
in statistically similar groups. will be continuing our testing and interaction that Top500 websites
Elite retailers have performed measurement of the whole group, receive, and to Pi Datametrics for
at an exceptional level across all with our findings contributing to the sharing data on brand search terms.
Dimensions, statistically separate 2020 ranking.
from the subsequent clusters. In 2019
they are Amazon, Argos, Dunelm, Elite retailers
John Lewis, Marks & Spencer and Judgement Congratulations once more to the
Next. Our congratulations to new Elite Our current system started with the InternetRetailing UK Top500 Elite
retailers Dunelm and Next, to Marks IRUK Top500 in 2015. Since then, retailers for 2019: Amazon, Argos,
& Spencer, which returns to the Elite research methods and metrics have Dunelm, John Lewis, Marks &
after three previous inclusions, and developed steadily. The criteria Spencer and Next.
to Amazon, Argos and John Lewis regarded as cutting edge this year
on retaining their positions from last will necessarily differ from those Ian Jindal,
year. Amazon has the distinction of of last year, since many one- time Editor-in-Chief
being the only retailer to have been innovations have now moved firmly
ranked Elite in all six of the Top500 mainstream.
reports published to date.
Top50 retailers bring us to the
50-retailer point and represent the Knowledge partners
current standard of UK best practice We thank BuiltWith for tracking the
in ecommerce and multichannel Top500’s websites and providing
retailing, exemplifying RetailCraft at information on the software used,
its best. such as ecommerce platform and
Between the Top100 and the payment methods; and Eggplant for
Top500, retailers are grouped in a measuring the performance and load
way that expresses their measured times of Top500 websites on mobile
performance in a way that goes and desktop browsers.
4 February 2020 © 2020 retailx.net, distributed by InternetRetailing.net

CONTENTS & FIGURES
CONTENTS
CONTENTS TABLES
The RXUK Top500 2020 6 1 Research at a glance 4
The Top500 in graphics 8 2 Leading retailers: Strategy & Innovation 19
From our partner 11 3 Leading retailers: The Customer 23
Interview: Doug Gurr of Amazon on customer obsession 12 4 Leading retailers: Operations & Logistics 25
Elite and leading retailers 14 5 Leading retailers: Merchandising 28
New and bubbling under 15 6 Leading retailers: Brand Engagement 31
Strategic overview: The factors driving UK retail change 16 7 Twenty brands with the biggest UK search growth 31
Strategy & Innovation: Strategically thinking 18 8 Leading retailers: Mobile & Cross-channel 33
The Customer: Shopper-friendly retailing 21 9 Definitions 44
Operations & Logistics: How the delivery promise is evolving 24 10 Our metrics 45
Merchandising: Product information 27
Brand Engagement: Engage with customers 30
Mobile & Cross-channel: Convenient service across channels 33 FIGURES
How the store experience is changing 36 1 Top500 sectors 8
Delivery as a service 38 2 Marketplaces, brands, others in the Top500 8
Case studies: H&M and JD Sports 40 3 The most popular ecommerce platforms 8
How the RXUK Top500 fits into RetailX research 42 4 How the Top500 has performed since 2016 9
What constitutes a retailer? 44 5 How the overall index has developed since 2016 9
Research parameters 45 6 Average performance by sector 9
Knowledge partners 46 7 Average performance by Top500 cluster 9
Conclusion 47 8 More mobile apps have predictive search 19
9 How fast retailers respond to queries 22
10 Retailers choose delivery for next-day service 25
11 Fewer retailers offer brand filtering of searches 28
12 Few retailers have digitised their stores 34
13 The RetailX portfolio 43
14 Marketplaces see more UK web traffic 43
MEET THE TEAM
CHLOE RIGBY FERNANDO DOS SANTOS

EDITOR RESEARCH PROJECT MANAGER, RETAILX
Chloe is the editor of InternetRetailing.net and Fernando co-ordinates the timelines for our
an award-winning business journalist. research team.
chloe@internetretailing.net fernando@retailx.net
MARTIN SHAW IAN JINDAL

HEAD OF RESEARCH, RETAILX EDITOR-IN-CHIEF
Martin devises the scope and methods of Publisher, speaker, advisor and NED, Ian leads
InternetRetailing’s research. our editorial and research businesses.
martin@retailx.net ian@internetretailing.net

UK TOP500 LIST
ELITE TOP 100 TOP 150 TOP 250 TOP 250

AMAZON ACCESSORIZE APPLE ADIDAS MAJESTICWINE
ARGOS AXMINSTER BONMARCHÉ ALDO MAMAS & PAPAS
DUNELM
BEAUTY BAY BOUX AVENUE ALIEXPRESS MASSIMO DUTTI
JOHN LEWIS
BEAVERBROOKS CLARKS ALLSAINTS MATCHESFASHION.COM
MARKS & SPENCER
BODEN COTTON TRADERS ANDERTONS MUSIC MINT VELVET
NEXT
BOOHOO.COM EARLY LEARNING CENTRE APPLIANCESDIRECT MODA IN PELLE
LEADING
BURTON MENSWEAR EBAY BERSHKA MONICA VINADER
ASOS
CARPHONE WAREHOUSE ESTÉE LAUDER THE BODY SHOP MULBERRY
B&Q
BLACKS CLAIRE'S EVANS BRAVISSIMO MYPROTEIN
BOOTS DECATHLON EVERYTHING5POUNDS.COM CALVIN KLEIN NASTY GAL
DOROTHY PERKINS DUNE LONDON FRAGRANCE DIRECT CASS ART THE NORTH FACE
EVANS CYCLES THE ENTERTAINER THE FRAGRANCE SHOP CHARLES TYRWHITT OFFSPRING
H&M ERNEST JONES HOMEBASE CLAS OHLSON OLIVER BONAS
HOLLAND & BARRETT GAME HUGO BOSS CREW CLOTHING COMPANY OYSHO
JD SPORTS
GO OUTDOORS JOJO MAMAN BÉBÉ DR. MARTENS PANDORA
NEW LOOK
H.SAMUEL KURT GEIGER THE EDINBURGH WOOLLEN MILL PAUL SMITH
RIVER ISLAND
HOBBYCRAFT LAPTOPSDIRECT ELLIS BRIGHAM MOUNTAIN SPORTS PAVERS
SAINSBURY'S
HOTEL CHOCOLAT LONG TALL SALLY ESPRIT PEACOCKS
SCHUH
ICELAND M&CO FARFETCH PHILIPS
SCREWFIX
SPACE.NK IKEA MAINLINE MENSWEAR FEELUNIQUE.COM POST OFFICE SHOP
TESCO JACAMO MARISOTA FOOT LOCKER PRETTYLITTLETHING

TOOLSTATION KAREN MILLEN MENKIND FURNITURE VILLAGE PULL & BEAR
WICKES L'OCCITANE MICROSOFT GAP QUIZ
WILKO LAKELAND MISS SELFRIDGE GABOR RICHER SOUNDS
TOP 50 LAURA ASHLEY MISSGUIDED GEAR4MUSIC.COM ROMAN ORIGINALS
AO LITTLEWOODS NIKE GEARBEST RYMAN
AMERICAN GOLF LOUIS VUITTON OCADO GOLDSMITHS SCAN
ANN SUMMERS MATALAN OUTDOOR & COUNTRY GUCCI SKECHERS
ASDA MILLETS PARTYCITY GUITARGUITAR SPECSAVERS
CHAIN REACTION CYCLES MONSOON PHASE EIGHT HARVEY NICHOLS SPORTSBIKESHOP
COTSWOLD OUTDOOR MORRISONS RADLEY HOBBS LONDON SUPERGA
CURRYS PC WORLD MOSS BROS. REEBOK HOME BARGAINS SWEATY BETTY
DEBENHAMS MOUNTAIN WAREHOUSE REISS HOTTER T.M. LEWIN
EURO CAR PARTS OVERCLOCKERS UK ROUTE ONE IRONMONGERYDIRECT TK MAXX
FAT FACE PAPERCHASE SALLY JYSK TED BAKER
FOOTASYLUM THE PERFUME SHOP SELECT JACK & JONES TESSUTI
HALFORDS ROBERT DYAS SELFRIDGES JACK WILLS THOMANN
HOUSE OF FRASER SEASALT CORNWALL SHOPDISNEY JAEGER THOMAS SABO
JD WILLIAMS SIMPLY BE SMYTHS TOYS JIGSAW THORNTONS
JESSOPS SIZE? SNOW+ROCK JOE BROWNS TOMMY HILFIGER
NISBETS SKATEHUT.CO.UK SPORTSDIRECT.COM JONES BOOTMAKER TRESPASS
OASIS SUPERDRUG TOPMAN JOULES TRIPP
OFFICE TOPSHOP TOPPS TILES LACOSTE USC
PETS AT HOME TRAVIS PERKINS UGG LEVI'S UNDER ARMOUR
SHOE ZONE URBAN OUTFITTERS VICTORIAN PLUMBING LLOYDS PHARMACY VANS
SUPERDRY WAITROSE WHSMITH LOOKFANTASTIC VICTORIA'S SECRET
UNIQLO WATERSTONES WALLIS LOVEHONEY WAREHOUSE
VERY WEX PHOTOGRAPHIC WHISTLES LUSH WELDRICKS PHARMACY
THE WORKS WHITE STUFF WIGGLE MAC COSMETICS THE WHITE COMPANY
YOURS CLOTHING ZARA ZALANDO MACHINE MART WHITTARD OF CHELSEA

EUROPE TOP500
RETAILX
REPORT
UK TOP500
2019
TOP 350 TOP 350 TOP 500 TOP 500 TOP 500
ANTHROPOLOGIE HEMA ATS EUROMASTER GAK PHOTOBOX
ARCO HOLLISTER AGENT PROVOCATEUR GOG.COM PLANET ORGANIC
AUSTIN REED HUGHES ELECTRICAL ALDI GARMIN PLAYSTATION STORE
AVON ITS ARIA TECHNOLOGY GEOX PLUMBASE
BALENCIAGA INTERFLORA ARMANI GLASSES DIRECT PRADA
BANANA REPUBLIC JOY ASICS GOPRO PRINTING.COM
BATHSTORE LAITHWAITE'S ASPINAL OF LONDON GOOGLE PRO-DIRECT
BENSONS FOR BEDS LANDS' END ASUS GRAZE PROTYRE
BURBERRY LEGO BT SHOP GUESS RALPH LAUREN
COS LINDEX BANG GOOD HACKETT RAPHA
CALENDAR CLUB LINKS OF LONDON BARBOUR HAWES & CURTIS RAZER
CARD FACTORY MANDM DIRECT BAREMINERALS HEAL'S REDBUBBLE
CARPETRIGHT MANGO BARKER & STONEHOUSE HERMÈS REGATTA OUTDOOR CLOTHING
CATH KIDSTON MAX SPIELMANN BERRY BROS. & RUDD HOBBY LINK JAPAN RICH TONE MUSIC
CEX MICHAEL KORS BETTYS HOTLINE ROWLANDS PHARMACY
CHAOS CARDS MOLE VALLEY FARMERS BLACKWELL'S INTERSPORT THE ROYAL MINT
CHARLES CLINKARD MONKI BOSE J CREW SCS
CLINIQUE MONTBLANC BRANDON HIRE STATION JML SCOTCH & SODA
COAST MUSIC MAGPIE BROWNS FASHION JTF SCRIBBLER
COSTCO MUSTO BUILD-A-BEAR WORKSHOP JACQUES VERT SEE TICKETS
THE COTSWOLD COMPANY NELLY.COM CARHARTT JEWSON SEVENOAKS SOUND AND VISION
CROCS NESPRESSO CHRISTIAN LOUBOUTIN JIMMY CHOO SNEAKERSNSTUFF
CYCLESURGERY NET-A-PORTER CHURCH'S JOHN SMITH'S STEAM
DEICHMANN NINTENDO CLINTONS JUNO RECORDS STUDIO (EXPRESS GIFTS)
DEMON TWEEKS NOTONTHEHIGHSTREET.COM CONVERSE KENZO SUNGLASS HUT
DIESEL NOVATECH CRABTREE & EVELYN KIEHL’S SUPREME
DIOR ORVIS CRAGHOPPERS KÄRCHER SWAROVSKI
DREAMS PERSONALISED GIFT SHOP CROMWELL L.K.BENNETT SWATCH
DULUX DECORATOR CENTRES PRETTY GREEN CRUISE LN-CC TATE SHOP
END. PUMA CULT BEAUTY LA PERLA THOMAS PINK
EBUYER.COM QVC DFS LEEKES TIMPSON
EURONICS RS COMPONENTS DELL LENOVO TOMTOM
F.HINDS THE RANGE DENBY LOAF TRIUMPH
FITNESS SUPERSTORE ROHAN DESIGUAL LOGITECH UK FLOORING DIRECT
FLANNELS ROMWE DIGIKEY LYLE & SCOTT UNITED COLORS OF BENETTON
FOSSIL RUSSELL & BROMLEY DISTINCTIVE DOORS MADE.COM VAPE CLUB
FOYLES SAMSUNG DOBBIES GARDEN CENTRES MENNACE VERSACE
FRASER HART SLATERS DOLLS KILL MOBILE PHONES DIRECT VITALSOURCE
FRENCH CONNECTION SOLETRADER DOVER STREET MARKET MOONPIG VIVIENNE WESTWOOD
G-STAR RAW STRADIVARIUS ECCO MUJI WARREN JAMES
GAMES WORKSHOP SURFDOME FARROW & BALL MUSCLE FOOD WATCHES OF SWITZERLAND
GANT TJ HUGHES FENDI NATIONAL TRUST SHOP WATCHFINDER
HMV.COM TIFFANY & CO. FIELD & TREK NEPTUNE WEDGWOOD
HP TOAST FIRED EARTH NEW BALANCE WEST ELM
HABITAT UK ECIG STORE FITFLOP OAKLEY WISH
HAMLEYS WALLS AND FLOORS FITBIT OPONEO WOLSELEY
HARRODS WEEKDAY FOOTPATROL THE ORIGINAL FACTORY SHOP WYEVALE GARDEN CENTRES
HARVEYS WYNSORS WORLD OF SHOES FORBIDDEN PLANET PC SPECIALIST YANKEE CANDLE
HATTONS YOOX FRED PERRY PATAGONIA YESSTYLE
HAWKSHEAD COUNTRY WEAR & OTHER STORIES FUNKYPIGEON.COM PEPE JEANS LONDON YVESSAINTLAURENT

ABOUT THE TOP500
FIGURE 1. FOUR IN TEN OF THE TOP500 Many Top500 retailers sell goods across several different sectors.
SELL FASHION PRODUCTS The ‘other’ category illustrates the diversity of the retail industry
Fashion accessories 211

Clothing: Fashion 202
Footwear: Fashion 183
Homeware 100
Footwear: Sports and leisure 97
Clothing: Sports and leisure 92
Jewellery 80
Consumer electronics 61
Cosmetics 60
Sports and outdoor equipment 55
Trade tools and equipment and DIY 43
Children's toys and accessories 42
Home and industrial appliances 38
Stationery and craft 31
Health 21
Software 21
Grocery 20
Drink 18
Music, film, TV 18
Garden 17
Automotive goods 17
Books 16
Utilities 15
Ready-made food 11
Other 98
0 50 100 150 200 250
FIGURE 2. ALMOST FOUR IN TEN TOP500 RETAILERS FIGURE 3. SALESFORCE AND MAGENTO ENTERPRISE ARE THE
ARE DIRECT-SELLING BRANDS MOST POPULAR ECOMMERCE PLATFORMS USED BY THE TOP500
Researched in collaboration with RetailX knowledge partner BuiltWith
7
16.0%
29.2%
182
14.6%
311
6.0%
9.4%
6.2%
9.2% 9.4%
Sell mostly third-party label products
Sell mostly own-label products
Salesforce Commerce Cloud IBM Websphere Commerce
Operate marketplaces
Magento Enterprise Oracle Commerce
Amplience Magento
Hybris Other

RETAILX UK TOP500
MEASURING PERFORMANCE
We score performance in tests to create an index value. The Aggregated Index Value (AIV) is the sum of the test results. This gives
us a way to compare performance by using relative AIV. It’s these relative values – between years, sectors, or clusters – that this
page shows. A higher AIV represents greater capability and performance. Our benchmarking suggests that Top500 performance
has markedly improved in most areas in recent years
FIGURE 4. HOW THE TOP500 HAS PERFORMED SINCE 2016

The Aggregated Index Value by performance Dimension 2016-2020
FIGURE 5. HOW THE OVERALL INDEX HAS DEVELOPED SINCE 2016
The Aggregated Index Value of the Top500 Index 2016-2020
Strategy &
Innovation Dimension
300 +9.8%
+15.2% +4.9%
250
+32.7%
Mobile & 200
The Customer
Cross-channel Dimension
Dimension 150
100
50
0
2016 2017 2018 2019 2020
Brand Operations
Engagement & Logistics
Dimension Dimension
2016
2016 Merchandising 2017
FIGURE 6. AVERAGE PERFORMANCE BY SECTOR
2017 Dimension 2018
2018
The Average Index Value by sector where 1.0 is the theoretical
2019
maximum. Some retailers belong
2020
to multiple sectors; sectors with
2019
20 or more retailers are shown
2020
Home and industrial appliances

FIGURE 7. AVERAGE PERFORMANCE BY TOP500 CLUSTER Grocery
This chart shows how much better the average retailers in the Children's toys and accessories
top clusters perform, compared to those in the bottom clusters Cosmetics
Entire Sports and outdoor equipment
Top500 Footwear: Sports and leisure
Clothing: Sports and leisure
lowest Top250 Top100 Leading Health
cluster
Homeware
Footwear: Fashion
Trade tools and equipment and DIY
0.537 0.607 0.67 0.764 Clothing: Fashion
0.4 0.458 0.587 0.64 0.713 0.8
0.556 Fashion accessories
Jewellery
Consumer electronics
Top350 Top150 Top50 Elite Direct-selling brands

Stationery and craft
Software

Become a
RETAILX SECTOR ANALYST REPORT DEFERRED PAYMENTS: 2020
BEAUTY & COSMETICS
it’s FREE for retailers

A solution within the ‘Payments’ category of RetailDNA
Member
INTRODUCTION
Beauty & Cosmetics brands have long relied on celebrity endorsements to promote
products and department stores to sell products. This is changing. While the rise of online
Welcome to the RetailX Sector Analyst
Reports, where we combine RetailX’s
RX001: February 2020
shopping has had less of a direct impact on the Beauty & Cosmetics sector than might four years of in-depth company per-
be expected1, department stores – a key physical channel to consumers for Beauty & formance research with analysis of the
Cosmetics brands – have borne the brunt of the shift to online retail. The indirect impact sector dynamics.
on the Beauty & Cosmetics sector has been a loss of consumer coverage.
Our reports outline the strategic and
Beauty & Cosmetics companies have responded by investing in direct-to-consumer (D2C) commercial context in which the best
business models, as well as by setting up internal venture capital funds to capitalise on retailers and brands perform in their
the potential from startup brands and technology vendors. Disruptive startups, such as market sectors. RetailDNA Solutions Library
Revolution Beauty, are challenging the status quo by adopting Fast Fashion techniques.
tions
mer
gy
duct
YouTube, Instagram and other social media platforms have impacted on how consumers Let us know of sectors you would like to Functional Categories
Strate
Opera
Custo
perceive celebrity, leading to the rise of social influencers. Some of these have gone on see us cover: research@retailx.net
Pro
to develop their own product ranges, notably Huda Kattan, who in 2018 was ranked 37th
1. Product Development and Design
on the Forbes list of America’s richest self-made women2.
DEFINITION 2. Buying and Sourcing
SHARELINES DIRECT-TO-CONSUMER OR D2C COMMERCE 3. Merchandising and inbound logistics
The rise of ecommerce has only indirectly impacted Beauty & Cosmetics is when brands sell or promote their
products directly to consumers rather than 4. Inventory Management and Distribution
Celebrity marketing has been disrupted and diluted by the rise of influencers via wholesalers and retailers.
The companies covered in this report are, on average, 100+ years old 5. Business Management
ONLINE SALES In 2018, these represented
Leading Beauty & Cosmetics companies are now operating internal VC funds c12.5% of the Beauty & Cosmetics market 6. Marketing
Sector Reports Blue Papers

Augmented reality (AR) applications are gaining traction in Beauty & Cosmetics worldwide. Sales patterns vary by territory. A solution within the ‘Payments’
The Fast Fashion business model is being reinvented in the cosmetics space
For example, in China, consumers made 7. Selling ‘Payments’
23% of all beauty retail purchases online in subcategory of ‘Selling’
8. Fulfilment
2017 (source: Credit Suisse). Sector leader
1. https://fashionista.com/2017/05/beauty-products-packaging-shopping-habits L’Oréal disclosed that 11% of its sales were
2. www.harpersbazaar.com/uk/beauty/a26320975/influencers-beauty-collaborators-brands/ 9. Customer Service and support
generated online in 2018.
10. Returns
11. Retention
TL;DR 12. Growth and Market Development
The internet abbreviation ‘TL;DR’ means ‘Too Long; Didn’t Read’. In that spirit, here THOMAS ANDERSSON
13. Test and Optimise
are some consideration points from this report: thomas@retailx.net
• been
Beauty & Cosmetics companies have
indirectly impacted by the shift to
new influencer-driven brands. This has
recently extended into technology
Thomas is a retail sector analyst
with more than a decade of
experience starting and divesting a multichannel
14. Physical Retail
multichannel retailing but the effect on investments, such as L’Oréal’s acquisition retail business. He is a grants evaluator for
Learn from and

Vinnova, a Swedish R&D government agency
department store chains, traditionally of Modiface, a technology it recently
a key retail channel for the sector, has used to promote its brands on Amazon MARTIN SHAW
been far greater. This has affected the
visibility of Beauty & Cosmetics brands
• Acquiring D2C brands has become an
important tool for the larger Beauty &
martin@retailx.net
Martin devises the scope and
InternetRetailing Blue Paper - Solutions to commercial questions
• Social
methods of RetailX’s research
media has had a fundamental Cosmetics companies as they evolve Blue Papers focus on solutions to commercial opportunities and Publisher: InternetRetailing InternetRetailing
challenges in multichannel retail and digital direct sales. 123 Cannon Street
impact on the sector. The rise of their business models CEO: Ian Jindal
• RetailX Our White Papers, Sector Reports and Top500 performance London, EC4N 5AU
influencers has diluted the marketing forecasts a further move towards
CEO: Ian Jindal Editor: Alex Sword
power of celebrities while increasing the Head of Research: Martin Shaw rankings set out the board-level discussion for commercial success Tel: 020 7062 2525
D2C, which will continue as the relative Senior Analyst: Thomas Andersson Section: Payments and our Blue Papers examine the point solutions, technologies Commercial Director:
number of relationships that brands need Web: www.internetretailing.net
importance of ecommerce over the Commercial Director: Andy James and systems that form part of the solution. Andy James
to manage Vendor: Klarna andy.james@internetretailing.net
high street grows. This move will be Design: Marzena Zychowicz
• Beauty
Drawn from our comprehensive industry directory of technologies
In the last five years, four of the Top 10 further accelerated by entry into new Address: RetailX, 123 Cannon Street Product: Pay later and services in use by our Top500, RetailDNA, our Blue Papers Designer: Julia Webber
London, EC4N 5AU
& Cosmetics companies have geographical markets where there are form a regularly-updated library of actionable, proven solutions.
© 2019 RetailX Limited
created internal venture funds to acquire no historical reseller relations
RXS009: Published in London, © 2019 RetailX Limited, www.retailx.net Page 1 of 28
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PARTNER PERSPECTIVE
Collaboration – the key

to smart acquisition
Finding and retaining new customers is never easy but, as Luke Griffiths,
UK General Manager at Klarna explains, businesses don’t have to go it alone
A decade of retail disruption and the consumers we spoke to said they are offer a differentiating service to draw
technological advancement has made drawn to retailers for the first time by customers in, we are also investing
the battle to gain and retain customers pop-up shops and real-life interactions heavily in building our brand – creating
even harder, with the cost of doing so with brands. This sentiment was felt a halo effect that helps drive growth for
continually increasing. But does it need most strongly among the ‘experience our partners too.
to be? Is there a smarter way to ‘hack’ generation’ – almost one in five (18%) of A recent study by consultancy Kearney
the acquisition process? As retailers those aged 16-24 – who hold tomorrow’s found that nearly 40% of shoppers (37%)
look for effective ways to grow during purchasing power. According to over said that if making a purchase costing
the next decade, let’s look at how leaning a third (35%) of respondents, it is even £250 or more, they would prefer to buy
on partners like Klarna can change the enough for retailers to be associated from a retailer that offered a ‘buy now,
traditional acquisition model. By using with fun content experiences rather than pay later’ option.
collaboration as a tool to tap into a pre- executing them themselves. With Klarna, retailers can ‘hack’ the
engaged and loyal customer base at a But it’s not just about pop-ups and acquisition process by gaining immediate
fraction of the cost, retailers can win, experiential. Consumers also place access to pre-engaged and already loyal
grow and build loyalty for the long term. an enormous amount of value on the consumers, at a significantly lower cost
logistical experience they have with than traditional methods of acquiring
retailers, and with convenience almost new customers. This lowers upfront
The changing landscape as important as cost. 28% of the acquisition costs, in turn increasing the
The purchase journey has become consumers we spoke to said that a good total lifetime value by allowing retailers
complex and non-liner, with both new returns process would encourage them to focus the saved money on nurturing
entrants and technologies shaking up to make a purchase, while 26% rely on and advocacy. What’s more, the unique
the traditional shopping experience next- or same-day delivery options. combination of convenience, brand
by adding everything from unlimited Meanwhile, 38% are more likely to appeal and user experience delivered by
inspiration to a plethora of new ways to shop with a brand or retailer that offers Klarna significantly boosts engagement,
pay. Is this change a threat? Yes, but it’s flexible payment options. positive sentiment and propensity to
also an exciting opportunity for retailers spend over time.
to evolve their approach to engaging If the last decade was about
with consumers and, as a result, to drive The power of partnerships change, this next one should be about
longer term loyalty. It’s a lot to think about but the good collaboration. By actively seeking out
So, what do today’s increasingly news is that retailers don’t need to go partners to join forces with, retailers
demanding customers expect? In it alone. Help is at hand, though not can create closer connections with
a recent study, we commissioned necessarily through traditional models. customers. It’s the smart way to win the
interviews with over 2,000 UK shoppers While retailers might once have looked gain and retain game.
to find out. It transpires that, in the to advertisers or affiliates to engage
new era of consumerism, emotional and acquire customers – spending a
connection is a greater driver of loyalty lot in the process – smart retailers are ABOUT KLARNA
and advocacy than price or product. now forging partnerships with service With Klarna, customers can shop at their favourite
providers in order to deliver big benefits. online stores and pay later, getting what they
Klarna is one such provider that love today. For the last 14 years, Klarna has
The experience economy is pioneering a new approach to been connecting major retailers with millions
Emotional connection comes from powerful partnerships. Not only do our of customers around the world, allowing safe,
customers’ experiences. One in ten of smooth and flexible payment options secure fee- and interest-free payment options.

INTERVIEW
A story of customer obsession

Amazon is only the RXUK Top500 Elite retailer to have appeared in the top ranking
in all the Top500 reports so far. Chloe Rigby asked Doug Gurr, UK country chair,
about the Amazon approach to retail
Amazon is, by almost

two decades, the
youngest retailer
to feature in the
Elite ranking of the
RXUK Top500 2020.
Yet the 21-year-old
is the only one to have featured in that
top ranking every year since the series
was launched in 2015. It’s done that
despite having what some might see
as disadvantages.
It’s an online-only retailer in a
multichannel and ecommerce industry
that has discovered the huge advantage
of shops as a place to collect and return
online orders. It also broke into an
industry dominated by long-standing
heavyweight retailers, and it did so at a
Copyright © Amazon
time when shoppers did – and still do –

prefer to buy in shops. But in a relatively
short period of time, the retailer has led
a change in the way shopping works,
Amazon’s extensive locker network supports its high level of delivery promises
both for its own customers and for
those of other retailers. But how?
Doug Gurr, who leads Amazon in the
UK, says its strategy is simple – it starts we will continue to measure ourselves Investing in talent
and ends with the customer. in terms of customer-centric metrics. In order to deliver that innovation for the
We invest for the long term and will customer, the retailer invests heavily in
continually refine and improve our developing talent across the UK. “We
Customer obsession offerings based on customer feedback.” have ramped up UK investment to house
“At Amazon, everything we do is If Amazon can’t easily give the 1,000 additional highly-skilled roles in
underpinned by customer obsession, customer what they want, it stands Manchester, Edinburgh and Cambridge,
so the customer is most important to ready to make it up. Amazon’s second while across Europe, we will be providing
us now and always will be,” says Gurr, key focus is firmly on innovation. “We space for over 5,500 highly skilled
Amazon’s UK country chair. “It is the love to invent for our customers,” says researchers and developers working
fundamental principle that drives our Gurr. “When we are innovating, we across Amazon’s 25 development centre
business today all around the world. always start with the customer and sites,” says Gurr. “These jobs range from
“Our strategy for customer obsession work backwards, striving to provide machine learning scientists, robotics
is simple – start with the customer and them with ever-better convenience, engineers and solutions architects to
then work backwards. Looking ahead, selection and value.” software, hardware and flight engineers.”

INTERVIEW
Copyright © Amazon
Amazon is halfway through a year-long pilot to use pop-up stores to work with smaller retailers that have built their businesses online. It is working
with Enterprise National to launch ten ‘Clicks and Mortar’ over a year. The first, shown above, opened in Manchester in June, and represented a
move onto the UK’s high street for a retailer that has previously sold only online. About 100 small businesses – the kind of businesses that already
sell on its marketplace website – are expected to sell through Clicks and Mortar shops. In 2018, 58% of products sold on Amazon’s site were sold
by smaller sellers
Such investment is set to continue with the type of retailers that sell on
well into the future. “In 2020 and beyond, its own website (see picture caption
we will keep innovation competitive by “We are delighted to be included above). “In June 2019, we launched
continued investment in hiring and in the RetailX UK Top500. At Clicks and Mortar, a pilot programme
training a diverse workforce,” says to help up-and-coming online brands
Gurr. “At Amazon, we believe the key Amazon, we have a relentless sell in store for the first time,” says
to innovation is diversity – whether focus on the best selection, Gurr.” By working with small business
that is having global R&D (research support network Enterprise Nation,
and development) teams across
prices and buying experience we have helped more than a hundred
geographies to understand local issues, for our customers, so it is a small online businesses test physical
or encouraging more women to enter retail for the first time with Clicks and
STEM (science, technology, engineering
great privilege to be included Mortar pop-ups in Manchester, Cardiff,
and mathematics) careers through as a top retailer” Doug Gurr, UK Edinburgh, Sheffield and Leeds, with
our Amazon Amplify programme. We country chair, Amazon more to come this year.”
want to attract and retain the best and Despite the retailer’s success so far, it
brightest talent across the world to says it won’t rest on its laurels. Instead,
foster greater innovation and raise the it still believes there’s much more to
bar for customers.” Gurr points out that in December 2019, do. “At Amazon, we often say, ‘It’s still
only 21.3% of UK retail sales were Day One’,” says Gurr. “We’ve only just
made online, according to the Office begun and there’s still so much more to
Why stores matter for National Statistics (ONS). That come. In truth, none of us know where
Despite its role as a pureplay retailer, suggests, he says, that, “79% of UK customers will take us next. That is a
Amazon is clear that it represents shopping by value remains in physical challenge, but an exciting one, and that
only one part of retail, and that shops stores.” The Amazon response? To is the beauty of innovating on behalf of
remain important to its customers. launch its own stores in partnership our customers.”

ELITE AND LEADING RETAILERS
Stand-out performers
Multichannel retailers dominate the RXUK Top500, where pureplays can compete
only due to exceptional performance, primarily in operations and logistics
The RetailX Top500 – previously the occasions. But Dunelm moves straight up to the
InternetRetailing Top500 – has tracked the top echelon, having been classed as a Leading
leading ecommerce and multichannel retailers retailer on only one previous occasion, in 2018.
that sell in the UK since 2015. At the top of the Elite retailers Amazon and John Lewis can be
index are two groups that highlight the very classified as ‘department’ type retailers, selling
best performing retailers in UK retail. The across a number of distinct categories. The
Elite group features those at the cutting edge same is true, to an extent, for Marks & Spencer,
of performance, while Leading retailers are which sells clothing, homewares and food, and
those that demonstrate best practice across also Next, which trades in the fashion and
their businesses. Both lists change from year homewares categories. While Dunelm too has
to year, driven in part by the metrics selected a department-style structure, that structure is
in the Strategy & Innovation Dimension to best firmly focused around homewares.
reflect retail state-of-the-art. It’s notable that this year there are no
supermarkets ranked Elite, after three years
in which at least one grocer, variously Asda,
Elite retailers Sainsbury’s and Tesco, has consistently
Six retailers appear in this year’s Elite group: appeared in this ranking.
Amazon, Argos, Dunelm, John Lewis, Marks &
Spencer and Next. Amazon is the only retailer
to have appeared in the Top500 Elite every year Leading retailers
since the index was first compiled in 2015. Its The Leading group this year features 19
six top rankings are significant because it is retailers. Fashion clothing is the largest
the only online-only retailer ever to have been category to be represented in the group. Asos
named an Elite retailer, reflecting the way it is the only pureplay in a group of five that also
has used its performance in Operations and includes Dorothy Perkins, H&M, New Look and
Logistics to rival those with stores. River Island.
That’s because a company’s size, as measured Asda, Sainsbury’s and Tesco all appear from
in the Footprint Dimension, accounts for 30% of the supermarket sector, while health and
its ranking in the Top500 – and most of the UK’s beauty is represented by Boots, Holland &
largest retailers are multichannel, selling both Barrett and Space NK – the latter making its
online and through shops. first appearance.
Argos and John Lewis come closest to Trade and DIY tools and equipment retailers
rivalling Amazon’s track record. Both appear are well represented by B&Q, Toolstation and
in this category for the fifth time, having been Wickes. Wilko also makes an appearance,
ranked Elite all but one year. Argos was ranked although it also sells in categories from health
Leading in 2017, as was John Lewis in 2018. and beauty through to stationery, crafts and
Marks & Spencer is ranked an Elite retailer toys. Footwear retailer Schuh is ranked Leading
for the fourth time, having been ranked Leading for the fourth time, sports clothing businesses
in 2016 and 2019. Next and Dunelm both JD Sports and Evans Cycles both for the second
appear for the first time. Next has previously time, and outdoor retailer Blacks makes its first
been classed as a Leading retailer on four appearance in the group.

NEW AND BUBBLING UNDER
NEW AND BUBBLING UNDER

New retailers enter the RXUK Top500 each year, but many more lie just on the other side of the Top500 borderline. Here we list the 44
new members for 2020 and the ‘bubbling under’ British retailers that are close to featuring in the index. This ‘bubbling under’ group are
the largest retailers in the Growth 2000 index and its 150 members will feature in the next report in that series.
TABLE 1. NEW THIS YEAR

PERSONALISED GIFT
BALENCIAGA CLINTONS HEMA LYLE & SCOTT WALLS AND FLOORS
SHOP
BERRY BROS. & RUDD CROCS HOTLINE NASTY GAL PRO-DIRECT WOLSELEY
BRANDON HIRE STATION CRUISE INTERSPORT NATIONAL TRUST SHOP PROTYRE YOOX
BROWNS FASHION DOLLS KILL JACQUES VERT NELLY.COM RAZER YVESSAINTLAURENT
BT SHOP EURONICS JOY OPONEO ROWLANDS PHARMACY
CARHARTT FITFLOP LA PERLA PATAGONIA TOAST
CHRISTIAN LOUBOUTIN GEARBEST LN-CC PC SPECIALIST UK FLOORING DIRECT
CHURCH'S GOG.COM LOAF PEPE JEANS LONDON VIVIENNE WESTWOOD
TABLE 2. BUBBLING UNDER

ABEL & COLE CAMPER GOUSTO LIGHTINTHEBOX REVOLUTION BEAUTY THOMPSON & MORGAN
ABERCROMBIE & FITCH COMPLETE CARE SHOP GRAILED LINZI ROKIT TIMBERLAND
ABSOLUTE-SNOW.CO.UK CORSAIR GRATTAN LIZ EARLE SAMUEL WINDSOR TISO
ACE (EXPRESS GIFTS) CREATE AND CRAFT GREEN MAN GAMING LOVEKNITTING.COM SECRETSALES TOOLSTOP
ACNE STUDIOS CROCUS GROWELL MAGIC MADHOUSE SELECT SPECS TREDZ
ALLBEAUTY DERMALOGICA GYMSHARK MAISONS DU MONDE SHOPTO URBAN INDUSTRY
AMARA DOLCE & GABBANA HTC MAJE SKAGEN VERO MODA
AMBROSE WILSON DRONESDIRECT HAWKIN'S BAZAAR MARC DARCY SMYTHSON VESTIAIRE COLLECTIVE
ANGLING DIRECT DROP HELLOFRESH MERLIN CYCLES SNAPFISH VIAGOGO
APPROVED FOOD DUNNES STORES HIGH & MIGHTY MILITARY 1ST SOCIETY6 VICTORIAPLUM.COM
ARMANI EXCHANGE EMMA BRIDGEWATER HORNBY MOBILES.CO.UK SOCKSHOP VIKING
BAKER ROSS ENVATOMARKET HUSH CLOTHING MOLTON BROWN SOFA.COM VIRGIN WINES
BELKIN EPSON I SAW IT FIRST MR PORTER SPORTPURSUIT VISTAPRINT
BLACK CIRCLES ESPARES IDEAL WORLD NEWEGG SPORTSSHOES.COM WACOM
BLINDS2GO EVE SLEEP THE IDLE MAN NOTCUTTS SSENSE WATCH SHOP
BONDARA FASHION EYEWEAR IHERB THE OUTNET STANLEY GIBBONS WAYFAIR
BOOKDEPOSITORY.COM FASHION NOVA IN THE STYLE PATROL BASE STELLA MCCARTNEY WEIRDFISH
THE BOOK PEOPLE FASHION WORLD INSTANT PRINT PERUVIANCONNECTION STERLING FURNITURE WESTERN DIGITAL
BOX.CO.UK FEATHER & BLACK JAPAN CENTRE PETER CHRISTIAN STUBHUB THE WHISKY EXCHANGE
BRADFORDS FORTNUM & MASON JARROLD PREMIER MAN SUPERBUY WOLF & BADGER
PROFESSIONAL MUSIC
BRANDALLEY FREE PEOPLE KALEIDOSCOPE SUPERFI WOODHOUSE CLOTHING
TECHNOLOGY
BRORA.CO.UK FREEMANS.COM KATE SPADE QD STORES SÉRAPHINE WORDERY
TLC ELECTRICAL
BULK POWDERS FURNITURE123 KWIK FIT RAY-BAN ZAVVI
SUPPLIES
CCL COMPUTERS GEMPORIA LEISURE LAKES BIKES RESERVED TAILS ZEE & CO
THE CAMBRIDGE GETTINGPERSONAL.
LIBERTY LONDON REVERB TEESPRING ZOOPLUS
SATCHEL COMPANY CO.UK

STRATEGIC OVERVIEW
The factors driving change in UK retail

Leading UK retailers are being pushed to perform in a highly competitive retail
environment. The results of this can be seen in this year’s Top500 research
UK retailers are working steadily to improve their retail landscape. David Fox, co-head of retail
performance online and across retail channels agency at Colliers, has said that CVA usage
as they trade at this time of ‘retail crisis’. Yet a has lowered rents, threatening the viability of
challenging environment appears to be fostering shopping centres. One international retailer,
both innovation and a fresh commitment to IKEA, is reported to have benefited from bargain
giving shoppers the retail experiences that prices to buy a London shopping centre. It now
work for them, whether they prefer to buy and plans to open its own small format store in
browse in-store or online from desktop or mobile Hammersmith King’s Mall.
websites and apps, or social media, or across all
the channels that are relevant to them.
‘In the ever-changing landscape

Setting the context retailers are now faced with, it’s more
Stores are currently closing across the UK in
what the Centre for Retail Research (CRR) has
important than ever to evolve and be
termed a “retail crisis”. It predicts that 17,556 agile, efficient and deeply connected
shops will close this year – up from the 16,073
that it recorded closing during 2019. In January
to our customers’
2020 alone, department store Debenhams
and nursery retailer Mothercare both shut
stores that had been a familiar presence on According to the British Retail Consortium, last
UK high streets for many years. Professor year was retail’s worst year on record, marked as
Joshua Bamfield, director of the CRR, says it was by the first ever overall decline (0.1%) in
the closures come at a time when customers annual retail sales, while online non-food sales
are spending less while retail costs are rising. grew by just 2.6% on its index.
“The commercial pressures of higher labour This comes as shoppers continue to change
costs, business rates and relatively weak the way they buy, opting to shop more often
demand will continue to undercut profits and online. The BRC found that by the peak shopping
force the weakest companies to close stores months of November and December 2019, 34.2%
to enter administration,” he said. “The high of retail sales took place over the internet – 1.8
street and suburbs will continue to decline.” percentage points higher than at the same time
Some retailers opt for Company Voluntary in 2018. The BRC cites factors including CVAs,
Arrangements (CVAs) that allow them to trade shop closures and job losses over the course of
through their difficulties, renegotiating costs 2019. Political and economic uncertainty also
such as property rents and lease lengths. But played a role. In 2019, BRC chief executive, Helen
research from real estate company Colliers Dickinson, said, “Twice the UK faced the prospect
International shows that of 23 UK retailers that of a no deal Brexit as well as political instability
have gone through a CVA process since 2016, that concluded in a December general election.”
13 have later gone into administration. While This political instability is set to continue
CVAs aren’t helping every retailer that uses through 2020, as the UK waits to see what leaving
them, they may be having a wider effect on the the European Union will mean in practical terms

STRATEGIC OVERVIEW
both for retailers, who are used to managing

European supply chains, recruiting European staff
and selling cross-border into the EU free of tariffs
or customs – and for the customers who buy from
them. If UK shoppers feel they have less money
to spend, they are likely to cut back on what they
spend on retail.
Factors affecting UK retailing also include a
new level of environmental awareness among
consumers, especially younger generations,
and a move towards buying more sustainably.
That might mean buying fewer retail products,
or opting to buy items that have a lower carbon
footprint. Retailers certainly appear to be
responding to those concerns and are opting
to use less packaging and to replace plastics
with recyclable alternatives. The popularity of
Copyright © Matalan
replacements to single-use items, from bamboo

coffee cups to shopping bags, is growing.
Dickinson said, “Looking forward, the public’s
confidence in Britain’s trade negotiations will have
a big impact on spending over the coming year. Matalan chief executive, Jason Hargreaves, says it’s more important than ever to be
There are many ongoing challenges for retailers: agile in this current time of political uncertainty
to drive up productivity, continue to raise wages,
improve recyclability of products and cut waste.”
She noted it was essential that the government on their mobile websites, for example, while
make good on its promise to review, then reform, most (61%) offer next-day delivery and more
the broken business rates system which, she said, than half (52%) offer click and collect services.
“sees retail pay 25% of all business rates, while More than two-thirds (69%) show fulfilment
accounting for 5% of the economy.” options on their product pages, while 65% offer
autocomplete search suggestions for those
looking for a product on mobile. Almost all are
How retailers are responding using social media to some extent, with 97% on
The “challenging retail environment” has Facebook and 90% on Instagram.
become a common refrain for retailers reporting Individually, these incremental improvements
financial results both in 2019 and into 2020. might not seem significant. Taken together,
Yet they are working hard to adapt, as Jason they represent a steady shift towards building
Hargreaves, chief executive of Top150 value a highly capable retail sector empowered by
fashion retailer Matalan, said in January, when digital technologies to offer fast-improving
the business reported its latest, third-quarter, services to their customers. We can see a sector
figures. Hargreaves cited, “unprecedented moving on from a moment in which Elite and
levels of political uncertainty” that had hit Leading retailers moved much faster towards
overall sales and profits. But also, Matalan’s joined-up and seamless service. More recently,
online business had grown by a quarter. This retail performance is seen to be improving
was a time, he said, for retailers to adapt. “In more widely and across the board.
the ever-changing landscape retailers are Some of these improvements are smart and
now faced with, it’s more important than ever highly targeted, with traders moving back from
to evolve and be agile, efficient and deeply offering services that may not proved as popular
connected to our customers,” he stated. or profitable as hoped. Fewer now offer next-
His comments describe a pattern that is day collection, for example, while same-day and
visible in this year’s Top500 research. From nominated day and time delivery are also in decline.
graphics that illustrate the performance of the In the coming pages, we explore the six
Top500 over the years (see page 9), it’s clear that Dimensions that inform our Top500 listings,
performance has improved steadily over time to and we then go on to look in more detail at what
reach its best yet in 2020. It’s notable that this exactly retailers are doing to improve the way they
year, some services that were once considered operate. We see how they are improving delivery
cutting-edge are now used by most of those services (see page 37), as well as how they are
selling in this market. Almost all (94%) retailers investing in experiences that they hope will keep
now offer easier ‘hamburger’ style navigation their stores relevant (see page 39).

STRATEGY & INNOVATION
Thinking strategically
Retailers stand out in the Strategy & Innovation Dimension when they are early to
adopt significant new technologies and enable convenient shopper experiences
The Top500 crowd is starting to catch up with the

CONVENIENT DELIVERY, COLLECTION AND RETURNS
leaders. Across this year’s index, there’s evidence
that retailers are moving at speed to adopt best Most retailers now offer customers next-day delivery and the
practice approaches to multichannel selling. ability to collect online orders in-store. But RetailX research
Latest research for the Strategy & Innovation shows a row-back in the numbers currently offering more
Dimension shows retailers making it easier for sophisticated fulfilment services.
shoppers to buy via mobile, across channels and Delivery
via convenient delivery and collection services. In 2020, fast and convenient next-day delivery is offered by 61%
More are now providing a strong service as of Top500 retailers. But other potentially convenient delivery
standard. But it’s telling that the research also options remain cutting edge. A minority of traders offer Saturday
shows significant numbers stepping back from (26%), Sunday (11%) or nominated day (13%) delivery. Still fewer
super-fast and convenient collection services, and offer nominated time (5%), or same-day delivery – those that do
even from some delivery and returns services. stand out in the research as a result. The research also found
Perhaps that’s because those not offering the best that 55% of retailers show their fulfilment options on the landing
service in their sector have found it did not prove page in 2020, while 69% do so on the product page.
economic to compete in this way.
Collection
More than half of retailers (54%) now offer shoppers the ability
to collect in-store the items they ordered online. But same-day
RetailX research shows a row-back in the collection (6%) and collection in-store from the retailer’s own
numbers of retailers currently offering lockers (1%) both remain the preserve of leading retailers.
Retailers offer collection in an average of 94 hours (almost four
more sophisticated fulfilment services days) – and a median of 72, or three days.
Returns
By law, retailers must accept returns within 14 days of an online
RetailX researchers aim to understand in purchase. However, this year’s research suggests that how those
the Strategy & Innovation Dimension how returns can be made is becoming less flexible. In 2020, 43% of
Top500 retailers are serving their customers UK Top500 retailers enable traders to return an online order to the
and to recognise those that are using the latest store, down by five percentage points from 48% a year earlier.
technologies and retail services to provide The fastest category declines are among direct-selling brands,
multichannel convenience and the best customer where 42% offer the service, down by 8pp from 50% last year,
experience. They have analysed Top500 traders’ jewellery (-8pp to 48%), and trade and DIY equipment and tools
performances against more than 50 metrics (-8pp to 39%). The sectors where the service is most commonly
that they judge have the potential to improve offered include children’s toys and accessories (58%), fashion
service and set best practice standards. They clothing, accessories, footwear and groceries (all 52%), while it
consider approaches and technologies that are is least available among those selling consumer electronics and
already well-established as well as those that health (both 31%). This fall in the number of retailers offering
are emerging. Those metrics are taken from return to store is surprising to RetailX head of research, Martin
across Top500 research, assessing performance Shaw. “This service seems a key part of multichannel retail,”
in cutting-edge areas, from merchandising and he says, “but perhaps just not enough shoppers were using the
operations and logistics to brand engagement service, compared to the number opting to return by post, to
and mobile and cross-channel. make it worth maintaining the infrastructure.”

EUROPE
STRATEGY
TOP500&REPORT
INNOVATION
2019
FIGURE 8. MORE MOBILE APPS HAVE PREDICTIVE SEARCH THIS YEAR

THE FRACTION OF TOP500 APPS WITH PREDICTIVE SEARCH HAS INCREASED IN EVERY SECTOR BY A MINIMUM OF FIVE PERCENTAGE
POINTS (PP)
Sports and outdoor equipment +5pp

Homeware +15pp
Children's toys and accessories +15pp
Footwear: Sports and leisure +8pp
Clothing: Sports and leisure +10pp
Cosmetics +17pp
Consumer electronics +13pp
Clothing: Fashion +17pp
Home and industrial appliances +8pp
Trade tools and equipment and DIY +10pp
Footwear: Fashion +16pp
Jewellery +23pp
Fashion accessories +16pp 2019

Direct-selling brands +15pp 2020 increase
0% 20% 40% 60% 80%
Below, we look in depth at retail performance

STOCK CHECKING AND RECOMMENDATIONS
across business-critical measures. Delivery,
collection and returns enable shoppers to take RetailX researchers track the extent to which Top500
ownership of and, if necessary, return their goods retailers help customers explore their range through stock
in the most convenient manner. How products checkers and product recommendations. They found that
are presented to smartphone users matters 75% of retailers recommend similar products, and 28%
because zoomable images and predictive search enable customers to check store stock. More than half (56%)
both enable customers to make purchase enable shoppers to add a product to a wishlist.
decisions with confidence. Checkouts that work,
CUSTOMER COMMUNICATION CHANNELS
stock checking and recommendations and a wide
variety of customer communication channels all Top500 retailers this year enable their customers to engage
go to improve customer service and the customer with them via ten different communication channels, from
experience, however they choose to engage. email and telephone to various social media platforms.
TABLE 2. LEADING RETAILERS IN THIS DIMENSION

AMAZON MARKS & SPENCER
CHECKOUT ARGOS NEXT
Offering the option of checking out through a third-party
ASOS OASIS
checkout provider can make it easier for shoppers who
don’t want to share their details – yet it is still a minority B&Q RIVER ISLAND
option. The most popular is PayPal, offered by 31% of BOOTS SAINSBURY'S
Top500 retailers, but Amazon Pay and Facebook checkout
DUNELM SCHUH
are each offered by 9% of them. Some 44% of retailers
show payment options on the landing page, while 23% H&M SCREWFIX
enable one-click ordering, which will require shoppers JD SPORTS TESCO
to have previously saved their payment details on the
retail website. JOHN LEWIS WICKES

STRATEGY & INNOVATION
PRESENTING PRODUCTS TO SMARTPHONE USERS

The relatively small size of smartphone screens make Visual search is still very much an emerging technology
it a priority for retailers to enable their customers – only 8% of retailers use it in 2020. By contrast, 94% of
to quickly find products. Predictive search and retailers offer a three-line ‘hamburger’ button, enabling
zoomable product images also help in that quest. shoppers to navigate mobile websites more easily.
Search Zoomable product images
Predictive search makes it easier for app users to find When shoppers can zoom in to product images on
the products they are looking for. As they start to type in their smartphones, they see more detail of an item
the search box, suggested search terms appear. There’s they are considering buying. Top500 retailers appear
been a fast uptake of this among Top500 retailers over to have recognised the way this helps their customers’
the last year, with 38% of retailers with mobile apps now experience, overwhelmingly adding this feature to their
including it in their apps – a rise of 10pp from 28% last mobile websites over the last year, according to the latest
year. “This feature,” says Shaw, “makes navigation much RetailX research. It found that 70% of the 490 Top500
quicker and the fact that top retailers have been doing it retailers measured in both periods now use it. That’s a
for years means it’s something consumers now expect.” rise of 13pp on the 57% that did so last year. Shaw said
The fastest uptake came in retail categories where the feature needed to be implemented skilfully if it was
the details might be more important, while no categories to be useful to customers. “On mobile devices especially,
decreased their use of predictive search. Some 45% of product imagery needs to be full width and high resolution,
those selling jewellery use this technology in 2020, up while not significantly impacting on visual load times
by 23pp on last year. Other fast rises came among those and time-to interaction, to be competitive,” he said.
selling cosmetics (+17pp to 52%) and fashion clothing RetailX research shows that in 2020, every retail category
(+17pp to 48%). Predictive search is most widely used adopted zoomable images, with the fastest growth among
in the sports and outdoor equipment sector (61%), grocers (+24pp to 81% of 21 Top500 grocery retailers),
homewares (59%) and least commonly by direct-selling and those selling stationery and craft (+21pp to 64% of 32
brands (25%). “Perhaps there’s less need for it as many traders). Despite the growth, stationery and craft remained,
brands don’t have the large SKU ranges that make it however, the category where zoomable images on mobile
most helpful,” says RetailX’s Shaw. More widely used websites were least likely to be used. The feature was
is the autocomplete dropdown, which suggests terms most commonly found in the sports and outdoor equipment
that shoppers might use to search a mobile website. (85%), health (84%) categories and in grocery (81%).

THE CUSTOMER
Shopper-friendly retailing
In The Customer Dimension, RetailX researchers measure both user experience
on retail websites and customer service from the customer’s point of view
Designing retail from the shopper’s point of view HOW EASY IS IT FOR CUSTOMERS TO GET IN TOUCH
can help boost sales. When retailers make it easy WITH RETAILERS?
for existing and potential customers to buy from
them, it’s more likely that they will do so. In The Communication channels
Customer Dimension, RetailX researchers explore When shoppers want to contact a Top500 retailer they
both the customer experience and the customer can choose to do so through an average of 10 channels,
service that Top500 retailers provide. They look at from telephone and email to live chat on their website or
whether, and how, retailers deploy tools that they mobile app and direct messages on social media. But once
judge will make the experience easier. And they a retailer offers the channel, how easy is it for shoppers
look at this across channels from the mobile web to find the information they need in order to get in touch?
and mobile apps to customer service. Researchers RetailX research found that just under a third (30%) of
measure performance in this area across 36 retailers show their contact phone number on their landing
metrics covering areas from how customer page, but only 7% show a contact email on that page, while
service is offered and how fast service teams almost all have a ‘contact us’ page with these details or a
answer shoppers’ questions through to website web submission form.
speeds, one-click ordering, product ratings and One in five retailers (23%) offer live chat on their website,
returns policies. and 11% prompt shoppers for a chat within a minute of
The findings are presented below through two them arriving on the landing page. Fewer – at 8% – offer
key questions. First, how easy do retailers make live chat on their mobile app. Of the 183 retailers with apps
it for customers to get in touch? This is important that were assessed both in 2020 and in 2019, uptake of
for shoppers both before and after they buy. live chat on the app grew by one percentage point (1pp),
Before buying, they can use different channels to from 7%. Live chat is most commonly found in mobile
apps in the sports and outdoor equipment category: 14%
ask questions about a product. Before they buy,
of retailers in this category use it, following growth of 2pp
shoppers may also look to see how they will be
over the year from 12% last year. That’s followed by sports
able to get in touch if an order goes wrong.
and leisure clothing (11%). Use has also grown among those
Certainly if they have after sales questions, they
selling trade and DIY tools and equipment (+4pp to 9%). But
will want to get in touch via a range of channels.
live chat is less likely than last year to be found on mobile
How a query is dealt with is likely to have an
apps operated by those selling fashion accessories (-2pp
effect on whether they return to buy again – and
to 7%), and cosmetics (-2pp to 8%). Live chat’s reduced
so response times matter as well as the number
usage in sectors where customer preference is subjective
of communication channels. Websites – on
will surprise some but could reveal that retailers do not view
desktop and mobile – are the primary source of
live chat interactions as analogous to a product-oriented
information for shoppers, and so the speeds at
conversation with an in-store sales representative. Instead,
which they operate are an important part of the
retailers may view live chat as providing operations-type
customer experience.
customer support covering delivery queries or returns, for
The second question is: how easy is it for
example. Finally, three sectors used live chat to the same
shoppers to find, choose and buy a product? This
extent as last year: home and industrial appliances (9%),
area of enquiry looks at how retailers support
homewares (10%) and jewellery (11%).
customers in finding the right item – and how easy
they make it to buy and return that product. All are Response times
important areas of the customer journey – getting Researchers tested customer service quality by sending
them right can make a big difference to customers’ a simple email enquiry (through a form on the retailer’s
satisfaction with their shopping experience. website, if that option was available) and making a phone

THE CUSTOMER
FIGURE 9. AVERAGE RESPONSE TIMES FOR RETAILERS TO AN EMAIL OR WEB FORM QUERY
100
80
60
Number of retailers
40
20
0
0-5H 5-10H 10-15H 15-20H 20-25H 25-30H 30-35H 35-40H 40-45H 45-50H 50-55H 55-60H 60-65H 65-70H
Average response time (hours)
call, again with a simple request for information on retailer. RetailX research in collaboration with knowledge
the retailer’s services. Emails were answered in an partner Eggplant found that Top500 websites were visually
average of 17 hours 35 mins (up to a maximum of 72 complete on desktop browsers in an average of 9.8s and
hours - responses after this time were considered non- took an average of 10.3s to download fully. The median
responses) and a median of 12h 59m. The time taken visual completion time of 9s was the same in both years,
to respond was higher than last year, with the median but the median download time of 9.68s is 1s slower in
response time up by 175 minutes – or two hours 55 2020 than a year earlier. Download speed is related to the
minutes – on the previous year. Response times were size of websites: desktop websites were an average of
faster than last year among those selling sports and 3.1MB, and a median of 2.8MB in size in 2020. In 2020,
leisure footwear (-48 minutes to 14 hours and 47 minutes) the median size was 38,500 bytes more than in 2010.
and sports and leisure clothing (-118m to 13 hours and Leading retailers’ landing pages are visually complete in
33 minutes). But they slowed down among those selling just over a second, although they often take a few more
homewares (+410m to 13 hours and seven minutes) and seconds to finish loading some aspects of the page. It’s
trade and DIY tools and equipment (+333m to 10 hours this prioritisation of content, more than the volume of
and eight minutes). content (and size in MB) that separates the best retailers
A call to customer service took an average of 2m 32s from the rest at website performance.
and a median of 2m (120s) to complete. Researchers rated On mobile, websites were visually complete in an average
the service they received at a median four out of four and of 8.36s, and took an average of 8.98s to download fully.
the degree to which the issue they raised was resolved at The faster mobile download speed in comparison to desktop
four. Both measures stayed the same as last year. It’s a can be explained by the finding that they were lighter than
mixed bag but, in general, retailers are responding more desktop sites, at an average of 2.6MB and a median of
slowly to consumer requests for information this year than 2.3MB. But mobile websites remained at similar speeds
last. It’s a basic performance metric but one of the few in as in 2019: the median time to visual completion (8s) and
which the average retailer isn’t improving. to full download (8s) stayed the same.
Looking at how deeply shoppers engage with retailers,
Website speed RetailX knowledge partner SimilarWeb finds that visitors
The speed of a website is key to customer service online accessed an average of 9.77 pages per session, spending
since those sites are one of the customer’s primary sources an average of 5m 25s on the Top500’s websites. Just
of information on a retailer and the products they sell and, under a third of visits (31%) to the average Top500 website
more importantly, is a key sales channel for almost every bounce; the median website sees 27% bounce.

THE CUSTOMER
and in 2020 more retailers than ever are matching this level
HOW EASY IS IT FOR SHOPPERS TO FIND, CHOOSE
of speed and convenience. A good customer experience
AND BUY A PRODUCT?
during the return process can be the difference in a shopper
Finding the right product trying to purchase from the same retailer again. By law,
Finding a product is easier when shoppers have good retailers must give their customers 14 days, or two weeks,
navigation tools to hand. The simple three-line ‘hamburger’ to return a product they bought online. Top500 retailers
menu is fast becoming standard on mobile websites, and in give shoppers an average of 10 weeks (70 days) to return
2020, 94% of Top500 mobile sites feature this. That’s up by a product, but the median is much lower at 3.7 weeks (26
six percentage points (pp) from 88% in 2019. The feature days). Some individual retailers offer their customers as
was adopted most quickly by those selling stationery and long as a year to return a product, a figure that is likely to
craft materials (+17pp to 88%) – although this remains distort the average.
the sector with the lowest uptake – and by those selling
children’s toys and accessories (+13pp to 92%) and home
and industrial appliances (+13pp to 95%). The feature
is most common among grocers (92%). RetailX head
of research Martin Shaw says: “It’s emblematic of the
continuing adoption by many in the Top500 of mobile-first
browsing – which until recently was only a buzzword to
hundreds of the UK’s largest retailers. In 2020, perhaps
for the first time, we can say that the Top500 in general,
rather than just the Top100, are mobile-first or, at least,
mobile-optimised retailers.”
Shoppers can now see how other customers rated
products on more than half (55%) of websites – up by
2pp from 53% in 2019. Product ratings are now most
common among grocers (+10pp to 73%), those selling
health products (+8pp to 72%), and trade and DIY tools
and equipment (71%). Product ratings are least deployed by
retailers selling in categories where opinions are perhaps
very subjective, including jewellery (40%), fashion clothing
(40%) and fashion footwear (42%). The fastest declines
in the use of product ratings were among those selling
home and industrial appliances (-7pp to 67%) and sports
and outdoor equipment (-4pp to 77%).
When it comes to making product suggestions, 39% of
retailers recommend a product that complements the one
that shoppers are looking at. Just 5% enable shoppers to
add an image to their product review.
Buying and returning items
One in five (20%) of retailers enable shoppers who have
already registered their details to buy in just one click.
Leading retailers have offered such services for years now

ASOS LOUIS VUITTON
B&Q MARKS & SPENCER
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OPERATIONS & LOGISTICS
How the delivery promise is evolving

The provision of premium click and collect and delivery services is less popular
in 2020 compared to the previous year, RetailX research suggests
How retailers get online orders to customers

WHAT DO TOP500 RETAILERS OFFER ON
can make a real difference in where shoppers
DELIVERY?
choose to buy. When delivery options are limited,
slow or expensive, it’s easy to go elsewhere. In recent years, we’ve seen a move to enable ever-faster
Conversely, speedy and cheap delivery or delivery, but is that now in retreat? RetailX research
collection can remove an important barrier shows next-day delivery is more widely available in the
to the final purchase. Importantly, retailers UK in 2020, compared to 2019, but the options of same-
must ensure that their delivery promise stays day, Saturday and Sunday delivery have become slightly
profitable, while at the same time remaining less available. At the same time, the cost of standard
attractive to customers. As many have found, delivery has risen, although the minimum order threshold
this is a tricky balance to strike. for free delivery threshold has stayed the same.
In this Operations & Logistics Dimension,
Next-day delivery
RetailX researchers evaluate the promises
Researchers found more retailers offering next-day
thatTop500 retailers make around delivery, delivery in 2020 than in 2019. Some 61% of Top500
collection and returns as they build a picture retailers now make this option available, up by three
of how their capabilities have developed over percentage points (pp) from 58% last year. Shoppers
time. They consider how the offer varies can opt for next-day delivery to at least the same extent
between sectors, to what extent traders as last year in all retail categories.
pass on the full cost of getting an item to The fastest rate of adoption is in children’s toys (+7pp
the customer, and to what extent retailers to 63% of traders in this category), jewellery (+7pp to
go beyond the legal minimum requirements 60%), and in home and industrial appliances (+6pp to
when it comes to returns. “RetailX adopts 57%). This fast delivery option is most widely available
the perspective of the customer, the ultimate in the cosmetics sector (+3pp, 68%) and among those
arbiter of retail performance, when making selling sports and leisure clothing (+0pp, 67%) and
these assessments,” says Martin Shaw, head fashion footwear (+5pp, 66%). It is least widely available
of research at RetailX. among those selling stationery and craft and consumer
Research findings are presented here electronics products (both 54%), homeware (51%) and
through three questions. Firstly, what do Top500 trade and DIY equipment and tools (49%).
retailers offer on delivery? Within that, the
focus in on whether retailers opt for premium Same-day delivery
super-fast delivery services or for a slower but Same-day delivery remains a niche option in 2020, with
potentially more reliable and cheaper service. slightly fewer retailers (5%) offering the service than the
Secondly, are attitudes to collection previous year (6%). Same-day delivery is most widely
changing? That’s a question asked in the context used by those selling health products (+2pp to 11%),
that slightly fewer retailers are now offering groceries (-3pp to 10%), cosmetics, trade and DIY tools
collection at all, and that the number offering and equipment (both 9%). It is least widely used in sports
next-day collection and other premium services and leisure footwear, clothing, and sports and outdoor
has also fallen, in some cases significantly. equipment (all 3%) and by those selling children’s toys
The final question is, how are returns policies and accessories (-3pp to 3%). More fashion footwear
changing? Here researchers look at where and retailers have taken up the service (+2pp to 5%), while
how shoppers can return unwanted goods to the fewer of those selling home and industrial appliances
retailer they bought from, and at the differences and stationery and craft products (both -4pp to 4%)
in service compared to 2019. offer the service.

Saturday delivery FIGURE 10. RETAILERS INCREASINGLY CHOOSE DELIVERY WHEN OFFERING
The use of Saturday delivery is also slightly less popular, NEXT-DAY FULFILMENT
with 27% of retailers offering this service in 2020, down
Next-day fulfilment is one of the most expensive and competitive operations
from 30% a year earlier. It has most commonly fallen off
for retailers. In 2020, they’re more likely than ever to offer next-day delivery
among those selling sports and outdoor equipment (-9pp
but the same is not true for next-day collection, which is less popular this year
to 22%), home and industrial appliances (-8pp to 23%)
and sports and leisure clothing (-7pp to 19%). Retailers offering next-day delivery Retailers offering next-day collection
Customers buying groceries (30% of grocery retailers 100% 100%
offer the service), cosmetics (28%) and homewares (28%)
are most likely to be able to order for Saturday delivery,
while those buying sports and leisure footwear (21%),
jewellery (21%) and sports and leisure clothing (19%)
58% 61%
are least likely.
Sunday delivery
Sunday delivery is also less available in 2020 (11%) than 26%
19%
in 2019 (13%). Among the different shopping categories,
those selling fashion footwear (-3pp to 12%), fashion 0%
Jan 2019 Jan 2020
0%
Jan 2019 Jan 2020
accessories (-3pp to 11%) and jewellery (-3pp to 9%)
were most likely to stop offering the delivery service.
Sunday delivery is most common among retailers selling
groceries (+1pp to 16%) and consumer electronics (-2pp
to 13%) and least common at retailers selling jewellery
(-3pp to 9%), sports and outdoor equipment (-1pp to 8%), ARE ATTITUDES TO COLLECTION CHANGING?
and stationery and craft (+0pp to 1%). Click and collect is slightly less easy to find in 2020 than
in 2019, while it now takes slightly longer for retailers
Delivery costs to deliver online orders to stores or other locations for
The cost of delivery is higher in 2020 than in 2019. This collection. The more significant change is that quick
year, the median standard delivery charge at Top500 turnaround times from order to collection are much less
retailers is £4.50, up from £3.80 in 2019. The cheapest available than they were last year.
standard delivery charges are found at retailers selling Martin Shaw, RetailX head of research, says it probably
consumer electronics (median of £2.90), stationery and makes more sense for retailers to invest in competitive
craft (£2.90) and health products (£2.90). The highest delivery options than in collection. “However convenient
costs are found among those selling fashion clothing collection is, the consumer still has to do a lot of the
(median £3.80, average £4.60), homewares (median legwork,” he notes. “Not so with delivery. Consumers
£3.90, average £8.20) and trade and DIY tools and time and again say in surveys that they like collection,
equipment (median £4.70, average £4.90). but the evidence suggests that they don’t like it enough,
The median minimum order value for free delivery has when compared to other options, for retailers to invest in
stayed at £40 in 2020, the same as in 2019. Standard those systems as much as in delivery, which continues
delivery takes an average of 4.7 days. to become more speedy and customisable, in terms of
time and location, across the Top500.”
Click and collect

More than half (54%) of Top500 retailers enable shoppers
to buy online and collect in-store in 2020 – down from
56% last year. Customers are most likely to be able
to collect cosmetics (63% of cosmetics retailers offer
TABLE 4. LEADING RETAILERS IN THIS DIMENSION collection), fashion clothing (62%) and fashion footwear
AMAZON MARKS & SPENCER (61%). The only category where more retailers offer the
AO MOSS BROS. service in 2020 than in 2019 is in health products (+1pp,
to 47%), while significantly fewer retailers selling groceries
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(-6pp to 50%), sports and outdoor equipment (-7pp to
ASOS OASIS 59%), and trade and DIY tools and equipment (-9pp to
BOOTS PETS AT HOME 50%) offer click and collect.
DUNELM SCHUH Next-day collection
EURO CAR PARTS SHOE ZONE In 2020, 19% of leading retailers enable shoppers to
HOLLAND & BARRETT SPACE.NK
collect their online orders the following day. That’s down
by 7pp from 26% last year. The service has become less
LITTLEWOODS YOURS CLOTHING available across all sectors, most noticeably among those

selling trade and DIY tools and equipment (-13pp to 23% HOW ARE RETURNS POLICIES CHANGING?
from 36% last year), consumer electronics (-14pp to
Under UK law, consumers can return an item they bought
21%), and sports and outdoor equipment (-14pp to 22%).
online within two weeks for a refund. Yet many retailers go
At the other extreme, it is slightly less available among
well behind this legal minimum, with the average Top500
those selling fashion footwear and jewellery (both -3pp
retailer offering 70 days – or 10 weeks – for shoppers to
to 21%) and stationery and craft products (-3pp to 14%).
change their mind. That’s likely to be a deciding factor for
Same-day collection many as they consider where to buy, with how easy it is to
The availability of speedy same-day collection has fallen make a return another key issue for shoppers.
fast during the last year – across all sectors. 7% of Top500
Returning to different locations
retailers offer the service in 2020, down by 4pp from 11%
Sending an item back in the post is the single most common
last year. It is most reduced among those selling children’s
way that shoppers can return unwanted online orders,
toys and accessories (-6pp to 10%), sports and outdoor
with this option advertised by 67% of Top500 retailers in
equipment (-6pp to 9%) and consumer electronics (-8pp
2020. That’s followed by returning to one of the retailer’s
to 8%). Availability has reduced more slowly among those
stores (43% of multichannel retailers) which is down by a
selling fashion clothing (-2pp to 3%), cosmetics (-2pp to
significant 5pp from 48% in 2019.
4%) and fashion accessories (-2pp to 4%).
In 2020, more retailers enable their customers to make
How long does collection take? their return via a third-party location, with 25% doing so in
The standard time between placing an order and collecting 2020, up from 20% a year earlier. The greatest changes
the product in-store rose by four hours to a median of 73 are to be seen in the sports and leisure footwear (+10pp to
hours – just over three days. The median time to pick-up 40%), fashion clothing (+9pp to 35%), sports and leisure
reduced by 10 hours to 55 hours (just over two days) clothing (+9pp to 37%) and fashion footwear (+8pp to
among those selling children’s toys and accessories but 38%) categories.
increased among those selling sports and leisure clothing Return via pick-up from the house continues to be offered
(+14h to 86 hours), footwear (+16h to 86) and home and by a small but significant minority (15%) of retailers.
industrial appliances (+21h to 77).
Pre-paid returns
Third-party collection points Significantly more retailers now underwrite the cost of
Collecting online orders at a third-party collection point sending back an unwanted online order. In 2020, 38% of
remains relatively uncommon in 2020 since almost two- retailers offered pre-paid returns. That’s up by 16pp on
thirds (65.8%, or 329) of retailers do not offer this service the 22% which did so in 2019. The trend was visible in all
to shoppers. But 125 retailers (25%) do enable pick-up at sectors, with the biggest rises in jewellery (+26pp to 36%),
one or more third-party services, while 37 (7.4%) offer sports and leisure clothing (+23pp to 49%), and sports and
at least two, seven retailers (1.4%) offer three, and one outdoor equipment (+22pp to 42%).
retailer (0.2%) offers collection via five networks. The
most commonly used third-party network is Collect+,
used by 68 retailers, or 13.6% of the Top500, followed by
myHermes ParcelShop (46 retailers, 8.6%), DPD collection
point (43, 8.6%), UPS (27, 5.4%), DHL (20, 4%), Doddle (8,
1.6%), HubBox (5, 1%), GLS ParcelShop (3, 0.6%), InPost
parcel lockers (3, 0.6%), and Pass My Parcel (2, 0.4%).

MERCHANDISING
Product information
Retailers lead the Merchandising Dimension when they fully explain their products
to customers and give all the information they need in order to buy
How retailers present a product makes all the

HOW DO TOP500 RETAILERS HELP CUSTOMERS
difference to whether shoppers choose to buy. FIND A PRODUCT?
When that product is presented online – where
shoppers cannot touch and feel an item for When retailers sell tens of thousands of products, finding
the right one can be a challenge, especially since so
themselves – detailed attention to merchandising
many shoppers are using the relatively small screen of
becomes all the more important. To be confident
a smartphone to do so. Retailers help them to narrow
in buying an item, website visitors need to know
in on the item they want through tools including in-site
how big it is, what it’s made of, how it works
search, and through navigational filters.
and how they might use it in the context of their
own day-to-day lives. Online merchandisers use Search and navigation
tools such as search filters, zoomable images Top500 retailers are making it easier for shoppers to find
and product reviews to communicate those the items they are looking for. Almost eight in 10 (78%)
points and to help shoppers find and buy the now offer drop-down suggestions when website users
start to type a search term on their website. 61% do so
on their mobile website, while 40% suggest full search
terms as the shopper starts to type. (See the Strategy &
When retailers sell tens of thousands Innovation Dimension (page 18) for more on how predictive
of products, finding the right one search has grown over the year). Browsers can continue
can be a challenge, especially on a to scroll down infinitely on 26% of mobile websites, while
94% of mobile websites feature the three-line ‘hamburger’
smartphone button that makes navigation easier on a smartphone.
Almost all enable users to narrow down their search
using navigational filters. The most common search filter
is by product type, used by 95% of the Top500. That’s
item that’s right for them. Giving shoppers all followed by price (60%) and by brand (49%). Search by
the information they need is not only important product type has seen a big uptake over the last year,
in helping them to buy in the first place but may with its use growing from 87% in 2019 to 95% in 2020
also help to reduce the level of returns. of 488 retailers measured in both years. Its use grew in
How effectively do Top500 retailers all categories, most notably in jewellery (+23 percentage
merchandise their websites? RetailX researchers points (pp) to 45%), cosmetics (+17pp to 52%), and
scored the leading websites against more than fashion clothing (+17pp to 48%).
35 metrics in this Merchandising Dimension in But while more retailers offered search by product
order to assess how retailers showcase their type, fewer offered search by brand. In 2019, 54% of the
goods and how they encourage shoppers to buy. 488 retailers measured in both years enabled shoppers
In doing so, they aim to understand both how to use this filter but in 2020, less than half (49%) do so.
retailers present their products and to establish The biggest falls in use are in the stationery and craft
a benchmark for those measuring their own category, where use fell by 14 percentage points (pp) from
performance against competitors, both in their 53% to 39%, and in the home and industrial appliances
own sector and across the Top500. (-12pp to 67%). There were only small rises in use, found
The information is broken down here into in the children’s toys and accessories (+1pp to 72%) and
three questions. First, how do Top500 retailers sports and outdoor equipment categories (+1pp to 75%).
help customers to find the product they are When a website user enters a search term that finds

MERCHANDISING
FIGURE 11. FEWER RETAILERS OFFER BRAND FILTERING OF SEARCHES IN 2020

THE FRACTION OF RETAILERS WITH BRAND FILTERING OF SEARCH QUERIES
Sports and outdoor equipment +1pp
Children's toys and accessories +1pp
Trade tools and equipment and DIY -3pp
Footwear: Sports and leisure -4pp
Health -7pp
Home and industrial appliances -12pp
Clothing: Sports and leisure -4pp
Consumer electronics -3pp
Cosmetics -8pp
Homeware -6pp
Footwear: Fashion -7pp
Clothing: Fashion -4pp
Fashion accessories -8pp
Jewellery -9pp
Stationery and craft -14pp

2019
Direct-selling brands -4pp 2020
0% 20% 40% 60% 80%
considering buying, using website navigation and no results on the website, 42% of Top500 websites show
search to narrow down the range on offer, while a blank page, while the remaining 58% show alternative
offering recommendations of other similar products information such as popular or trending products. This
that may be relevant? Second, how well do retailers is an approach thought more likely to result in a sale.
explain the products they sell, and to what extent Emerging technologies in this space include visual
do they enable people who have already bought the search. This year, just 8% of Top500 mobile apps enable
item to share their opinions? Finally, how easy is it shoppers to search using an existing image or one taken
for shoppers to buy an item? Do they have to register using their smartphone’s camera.
before checking out, and what payment options are
available for them to use?

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HALFORDS WICKES
ICELAND WILKO

MERCHANDISING
HOW DO RETAILERS EXPLAIN THEIR PRODUCTS? HOW EASY IS IT TO BUY?

Once a customer has found a product, how can they be Apparently small changes can make it much easier for
sure it’s right for them? That’s where images, ratings shoppers to complete their transaction, which is reflected
and reviews come into play. Retailers also make product in both conversion rates and sales.
recommendations to show customers similar items
they might not have considered, as well as flagging up Checkouts
individual products in daily deals and advertising banners. In 2020, more than six in 10 (38%) Top500 retailers
require registration before checkout, while the remaining
How images are used 62% allow shoppers to complete their transaction by
In 2020, almost three quarters (73%) of Top500 retailers guest checkout, including Apple Pay, Amazon Pay, PayPal
use several images of a product on the product page. and Google Wallet. The number requiring registration
Seven in 10 (70%) make product images zoomable on has fallen by 19pp since 2019; the number offering the
their mobile website, as do 54% of those with mobile option of guest checkout has risen by the inverse of 19pp
apps. The average Top500 retailer shows an average of at the same time.
4.3 images per product on its desktop website and four Making it easier to buy through guest checkout involves
on its mobile website. a trade off against the amount of information that retailers
can gather about a potential customer, and the figures
Ratings, reviews and sharing suggest that more are opting to demand that shoppers
More than half share on their websites the product ratings register. However, it may also increase the likelihood that
(55%) and product reviews (57%) that other customers shoppers will buy, thanks to speedier checkouts and the
have given, while 30% of those with mobile apps share greater likelihood of payment details being up-to-date.
product ratings. 40% enable shoppers to share a product
with friends and 3% enable them to ‘Like’ a product on Wishlists and site performance
their website via social platforms. It’s easier for shoppers to buy an item that they previously
saved while browsing and 56% of Top500 retailers enable
Product recommendations, deals and more shoppers to add a product to a wishlist on the website,
Almost three quarters (74%) of retail websites recommend as do 60% of those with apps.
similar products to the ones a customer is already It’s also easier for shoppers to buy when they get onto
looking at, and 26% recommend an ‘upsell’ of a higher- the website with no problems. Top500 websites have
specification or more expensive product, or of a product an average bounce rate of 31% in 2020, according to
that complements one already in the basket. These tactics research done in collaboration with RetailX knowledge
can let the shopper know about a product that may interest partner SimilarWeb. Once on the site, the average Top500
them but they may not have previously seen. Almost nine browser visits ten (9.8) pages and spends 325 seconds
in 10 (87%) run banner advertising to flag up services – that’s five minutes, 25 seconds – on the site.
or products on their website, 36% do so on their mobile
website, and 63% show an obvious promotion on their
website. Just under a quarter (24%) of those with mobile
apps flag up daily deals to app users, while 74% offer
push notifications from the app. These can be used to
alert shoppers when a relevant deal, product or service
becomes available. Just 7% highlight popular products
by flagging them as a best seller on their website.

BRAND ENGAGEMENT
Engage with customers

Retailers are finding new ways to talk to shoppers, RetailX research suggests
Leading retailers promote their brands through

HOW DO TOP500 RETAILERS ENGAGE
owned and third-party channels and involve WITH CUSTOMERS?
their customers in expanding brand awareness.
They provide a good view of the company on Retailers who support two-way conversations with
social media and engage with customers existing and potential customers can both answer their
visiting their websites, blogs and ‘about’ pages. questions and provide information and advice that may
Ideally, they are also seen to share customer help secure a sale.
feedback and reviews by any of these channels.
By doing so, satisfied customers effectively help Communication channels
raise awareness of their brand’s successes, UK retailers continue to reach potential customers through
while constructive criticism from less satisfied a wide variety of channels. In 2020, the average Top500
customers may well prove helpful in reworking retailer actively operates, or is available through, 9.6
the way that products or retail services work. communication channels, and a median of 10, where
channels include direct-to-customer ones such as
email and live chat as well as broadcast feeds on social
networks. That’s similar to 2019 and up from eight
channels in 2018. This year, 97% of Top500 retailers
Shoppers help boost awareness and have a Facebook page, and 90% have an Instagram
trust of the products they are looking profile. Some 88% are on Twitter, 82% are on YouTube,
at online when they share them 69% have a Pinterest account and 13% have a Snapchat
account. Most flag up their social presence, with 88%
linking to their social pages from the landing page. Almost
half (46%) enable shoppers to share a product on social
media. Of those that are on Twitter, the average Top500
In the Brand Engagement Dimension, RetailX
retailer has 2.4m followers. But the average is likely to
researchers analyse how Top500 retailers reach
be skewed by those retailers with the largest followings,
out to their existing and prospective customers,
since the median retailer had 312,737 at the time the
provide ways for their customers to get in touch,
research was carried out in early 2020.
and recommend products. They do so through
Live chat is available on 46% of Top500 websites –
35 different metrics assessing performance
and this pops up on 11% of Top500 landing pages within
in areas from social media presence and
a minute of a visitor arriving. Live chat on mobile is as
sharing to product page features and the time
yet less widely available, offered by only 8% of those
shoppers spend on their website. Data from
with apps.
RetailX Knowledge Partner SimilarWeb shows Visitors to 70% of Top500 websites can sign up to
how often – and for how long – people visit receive the newsletter from the landing page.
Top500 websites. Additionally, data from RetailX
Knowledge Partner Pi Datametrics shows how Engagement on retail websites
internet users search for different brands that The average Top500 retailer’s website receives 8.8m visits
sell in the UK. a year and a median of 2.3m, according to data researched
The findings are grouped here through three in partnership with RetailX Knowledge Partner SimilarWeb.
key questions. First, how do Top500 retailers Visitors spend an average of 324 seconds (5.4 minutes)
engage with customers? For this, the focus is on and a median of 293s (4.9m) on Top500 websites. They
the communication channels that businesses visit an average of 9.8 pages and a median 7.1 pages.
make available to shoppers, and how they But almost a third (31%) of visits to the average website
engage with them on their own websites. bounce –and therefore fail.

BRAND ENGAGEMENT
Second, how far do retailers support TABLE 7. THE 20 BRANDS THAT SAW THE BIGGEST GROWTH IN UK SEARCHES
customers in sharing products online? The
‘SHOPDISNEY’, FOR EXAMPLE, WAS SEARCHED 10X MORE IN THE YEAR TO AUGUST 2019
focus is on the extent to which retailers support THAN IT WAS IN THE PREVIOUS 12 MONTHS
product reviews and ratings on both websites and
mobile apps. Third, how easy do retailers make KEYWORD TOTAL SEARCHES PERCENTAGE INCREASE
it for shoppers to check out? Research in this
SHOPDISNEY 101,400 1163%
section takes into account the need to balance
the ease of a guest checkout with the role of the LOOKFANTASTIC 484,300 672%
‘owned’ website in gathering data from opted- VICTORIA'S SECRET 1,091,600 204%
in customers, which is useful for building future
FENDI 985,500 169%
relationships with those shoppers.
Finally, how often do shoppers search for TIFFANY & CO 891,500 155%
retail brands that sell in the UK? The answer WAYFAIR 9,861,000 151%
to this question provides a useful measure of DR MARTENS 2,792,000 147%
how well brands are communicating with their
target audiences. YESSTYLE 523,600 144%
ROMAN ORIGINALS 1,570,500 141%
SEASALT CORNWALL 104,500 137%
AND OTHER STORIES 2,064,000 137%
BAREMINERALS 207,100 134%
FLANNELS 5,586,000 132%
ARGOS JOJO MAMAN BÉBÉ
PAVERS 827,500 131%
AVON MARKS & SPENCER
LULULEMON 1,178,500 129%
BOOTS MATALAN
WEEKDAY 633,000 129%
DUNELM NEXT
COTSWOLD COMPANY 523,700 129%
ELLIS BRIGHAM MOUNTAIN OVERCLOCKERS UK
BONMARCHE 1,095,000 129%
SPORTS
MONKI 1,370,000 129%
EVERYTHING5POUNDS.COM SAINSBURY'S
DIOR 883,500 129%
HALFORDS WICKES
HOBBYCRAFT WILKO These 20 Top500 brand keywords enjoyed the biggest rise in searches in the 12 months
to August 2019, measured as a percentage of their total in the previous year. Researched
JD SPORTS THE WORKS
in partnership with Pi Datametrics
(pp) rebound from 26% last year, which was an all-time

HOW FAR DO RETAILERS SUPPORT CUSTOMERS low. Researchers had expected a continued reduction
IN SHARING PRODUCTS ONLINE?
this year as retailers (and especially brands) turned
Shoppers help boost awareness and trust of the products their attention to selling through their social channels
they are looking at online when they share them. Most using new features from the leading networks. It seems,
retailers now feature simple product ratings and reviews however, that despite a reduction in obvious social media
on their websites. links on product pages in the immediate aftermath of
the 2018 Cambridge Analytica scandal, those links are
Reviews, ratings and recommendations now reappearing on websites that had removed them.
Shoppers often read product reviews and ratings when Shoppers at four in 10 Top500 retailers are now seeing
they are deciding whether an item is right for them – or social media suggestion. The feature saw the fastest
not. More than half of Top500 retailers feature product uptake in the trade and DIY tools and equipment sector,
reviews (57%) and ratings (55%). Of retailers with mobile rising by 24pp to 50%. This is now the Top500 category
apps, 30% feature product star ratings on their mobile where sharing with friends is most commonly suggested.
app. 5% enable users to illustrate their website review Retailers selling home and industrial equipment
with an image. Some 8% of retailers with apps make it increased their use of this tool, which is found on 46%
easy for shoppers to find the products they’re looking for of websites in this category – 24pp more than in the
by offering visual search. previous year. A significant number of children’s toys and
accessories’ retailers also added social sharing compared
Sharing products to last year, with 46% retailers enabling their viewers to
More retailers now enable their customers to share the share, up by 19pp on the previous year.
products they find on their websites with friends. In 2020, Social sharing is popular among those selling cosmetics,
40% of Top500 retailers do so, after a 14 percentage point but less so among those selling groceries (-1pp to 38%)

BRAND ENGAGEMENT
and consumer electronics (38%). Perhaps shoppers buying

HOW OFTEN DO SHOPPERS SEARCH FOR RETAIL
tools and toys are just more likely to have other people
BRANDS THAT SELL IN THE UK?
who are interested in what they are considering buying,
whether that’s professional colleagues, fellow DIY-ers, or Brand awareness of leading retailers can be measured
relatives looking for present ideas for children. Just 3% by how often people search online for them. This can be
of the Top500 allow users to ‘Like’ their products using viewed as both a proxy for the opportunity of future brand
a social media plugin, a four percentage point drop on engagement and a measure of its historic success. RetailX
last year, when use of the feature was also at an all-time Knowledge Partner Pi Datametrics analysed searches for
low. On mobile, 46% of those with apps enable users to retail brands on Google UK for the year to August 2019
share an item on social media. and found that Google came out top, with 353.8m hits.
Amazon came second, with 207.6m, followed by eBay
with 197m. Following on were Argos (158m), Next (82.1m),
HOW EASY DO RETAILERS MAKE IT FOR SHOPPERS John Lewis (59.5m), Asda (57.7m) and Tesco (54.7m). Asos
TO CHECK OUT? (50.2m) and Debenhams (49.4m) completed the top 10.
Retailers balance making it easy for shoppers to checkout The top 20 also included Screwfix (48.3m), New Look
and complete their purchase with gaining marketing (43.8m), Marks & Spencer (43.6m) Sainsbury’s (42.7m),
information that they can use to communicate and build Sports Direct (41.3m), Currys (38.1m), B&Q (37.5m), IKEA
a relationship with their customer. Adding a social login or (35.9m), Boots (35.6m) and Very (33.3m).
third-party checkout to their website can make checkout The analysis excluded some retail keywords – such
faster and increase conversion, at the cost to retailers of as “apple”– that were likely to capture searches that
being more anonymous. were unrelated to a retail brand. However, it did include
RetailX research found that shoppers must register “amazon” despite the newsworthiness of the South
before they buy at almost two-thirds (62%) of Top500 American geographic region of the same name over the
retail websites. Almost a third (31%) offer PayPal checkout summer. That said, a search for “amazon fire” on Google
– up by 4pp from 26% last year. Other checkouts are UK currently returns almost exclusively hits for Amazon’s
less popular: 9% enable checkout via AmazonPay, 9% range of Fire products.
through Facebook and 5% through Google checkout. Brand Looking at which retail brands saw the biggest gains in
engagement normally means reaching customers before brand awareness, as measured through searches, Shop
a sale takes place, although it also includes retaining a Disney enjoyed a 1,163% rise in searches, to 101,400,
customer for his or her lifetime. It may be this consideration followed by Look Fantastic (+672% to 484,300), Victoria’s
which means some retailers opt to keep control of the Secret (+204% to 1.1m), Fendi (985,500), and Tiffany &
checkout, but of course such services generally take from Co (+155% to 891,500). Other interesting results included
the retailer’s margin as well. It would appear that with a Wayfair, which gained 155% more searches, to 9.9m,
growing number of retailers, this trade-off makes sense, while searches for Flannels grew by 132% to 5.6m.
presumably due to higher conversion rates when offering
third-party checkout.
Looking in more detail at how the most popular of
those options is used, researchers found retailers trading
across all sectors added the PayPal checkout to their
website. It was adopted most quickly among those selling
consumer electronics (+14pp to 23% of retailers selling
this category), fashion clothing (+8pp to 29%), cosmetics
(+8pp to 31%) and home and industrial appliances (+8pp
to 15%).
The smallest growth was in jewellery and sports and
leisure footwear (both +2pp). That may be because the
option is already widely used in sports and leisure footwear
and in fashion footwear (both 36%), and in sports and
outdoor equipment (35%). Those selling trade and DIY
tools, as well as home and industrial appliances (15%),
are the least likely to enable payment via PayPal.

MOBILE & CROSS-CHANNEL
Convenient service across channels

Flexible cross-channel services make shopping easier for customers on
the move, writes Chloe Rigby
The smartphone is now firmly established as the

TO WHAT EXTENT DO TOP500 RETAILERS ENABLE
largest single online shopping channel in the UK. SHOPPERS TO BUY VIA MOBILE APPS?
It’s grown fast in popularity in an ecommerce
context as shoppers use the one device that they More than a third of Top500 retailers have an iOS app for
always have with them to buy quickly whenever use on Apple smartphones and tablet computers. That’s
they want, and wherever they are. Mobile phones up by 7pp to 35% in 2020. Android apps, for use on other
brands of smartphones, have also risen in popularity,
have made it possible to buy from home or
although not yet to the same extent as iOS apps. In 2020,
work, while commuting or while out and about.
22% of retailers have Android apps, up by 5pp on last year.
Retailers have found innovative ways to use
Grocers were the most likely to add both types of app
the smartphone’s different features, including
during the year. Half (50%) of Top500 retailers have iOS
cameras as barcode scanners. It’s become a
apps. Among the 20 retailers measured in this category in
handy place for shoppers to house their favourite
both 2019 and 2020, there was a 12pp increase in those
retailers’ mobile apps, giving them a shortcut to
with an iOS app, from 40% to 52%. More than a third
completing all kinds of shopping tasks online, at
(37%) of grocery retailers have an Android app, with the
the time that suits them.
number growing by 9pp from 28% last year. App adoption
was also significant among those selling health products.
In this category, 30% have iOS apps (+12pp from 18%
in 2019) and 25% have Android apps (+8pp from 17%).
Android apps have risen in popularity, iOS apps are popular in cosmetics (50% of Top500
although not yet to the same extent as retailers have them) and jewellery (50%), but the use
is lowest among those selling trade and DIY tools and
iOS apps for apple smartphones equipment (-1pp to 35%) and direct-selling brands (35%).
Android apps are most popular among those selling
groceries (37%) and home and industrial appliances
(36%) and least popular among direct-selling brands
At the same time, mobile can act as a bridge (19%), followed by those selling health products (25%).
between online and the store, helping to
organise multichannel services, from buying
online and collecting in-store to returning an
unwanted online order to a store. Such services TABLE 8. LEADING RETAILERS IN THIS DIMENSION
give customers flexible and convenient shopping AMAZON JOHN LEWIS
experiences that make it easy for them to buy
AO MARKS & SPENCER
during the course of their everyday lives.
In the Mobile & Cross-channel Dimension, ARGOS NEW LOOK
RetailX researchers look at how Top500 retailers ASDA NEXT
serve shoppers across channels. They assess BOOTS SAINSBURY'S
whether retailers have a mobile app, and also
what cross-channel services they provide for their BURTON MENSWEAR SCREWFIX
customers. In addition, they hit the shops to find DOROTHY PERKINS TESCO
out how digital-in-store is working on the ground. EBAY TRAVIS PERKINS
The findings are presented here through three
HOLLAND & BARRETT VERY
key questions. First, to what extent do Top500

retailers enable shoppers to buy via mobile

FIGURE 12. FEW RETAILERS HAVE DIGITISED THEIR STORES
20%
apps? The use of apps is growing but varies by
type and by retail category. The mobile app is a Researchers visited the London stores of the Top150, recording
unique marketing channel via push notifications dozens of metrics with a focus on digital and multichannel-
as well as a platform for innovative features such enabled features
as virtual reality shopping or visual search for
similar products. Can staff reserve an item that is available on the
Second, what multichannel services do website but not in this store for you to collect later?
retailers offer? Use of in-store collection and
returns of online orders feature here, as do store 20% 80%
location and stock-level information on websites
and linking in-store purchases to online user
accounts with electronic receipts.
The final section analyses the in-store Yes
experience in those Top150 retailers that have No
shops in London with a focus on features of the 6%
‘digital store.’ 80%
Is there mobile
Yes (till-less) payment in-store?
WHAT MULTICHANNEL SERVICES DO No 6%
RETAILERS OFFER?
Retailers offer a more convenient customer experience
when they connect their online business with their stores
and develop a shopping journey that is as seamless as 94%
possible. Shoppers then find it faster and more reliable
to order the product they need online and collect it in a
store. Similarly, when a product is not wanted after all,
Yes
returning to a store or a third-party return point will often No
6%
prove more convenient than sending by mail. This year’s 94%
RetailX research reveals that multichannel retailers are
now less likely to offer collection and returns in their own
stores. For more on these subjects and on delivery, see Does theYesretailer provide digital receipts for
the Operations & Logistics Dimension (page 24). No
in-store purchases?
Click and collect 15%
Slightly fewer retailers now give online shoppers the option
of picking up their order in one of their stores. Some 54%
do so – down from 56% last year. Same-day collection is 94%
less widely available in 2020, with 7% of Top500 retailers
now offering this. That’s down by four percentage points
(pp) from 11% last year. Next-day collection has also
reduced in popularity, with 19% offering it in 2020, down Yes
85% No
by 7pp from 26% last year. 6%
At the same time, the service now takes longer. The
median standard time to collect increased by four hours
to three days and one hour in 2020. But the cost collection And there’s still room for improvement in old-
remained the same, at a median £1. fashioned customer service
Yes
Reserve and collect may offer a useful option for No Were you greeted?
shoppers who prefer to pay as they pick up the order
they placed online. But it seems to be losing its appeal
for retailers. In 2020, just 4% of retailers offer this, down
from 5% in 2019. 39%
94%
One in three (34%) of Top500 retailers now offer to
deliver products to at least one third-party click and collect
service. A quarter (25%) offer collection through one 61%
third-party provider, while 7.4% offer it via two providers Yes
and 1.4% offer it via three. Just 0.2% offer five choices No
of third-party provider.
34 February 2020
Yes
© 2020 retailx.net, distributed by InternetRetailing.net
No
CollectPlus, with 7,000 pick-up points around the UK, UNDERSTANDING THE IN-STORE EXPERIENCE
is the most popular provider, offered by 40% of those RXUK Top500 researchers hit the ground in London during
Top500 retailers who use a third-party provider. That’s the summer of 2019 to find out to what extent stores run
followed by myHermes ParcelShop, with 4,500 pick-up by Top150 retailers incorporate multichannel and digital
points and used by 27% of retailers in this category. A features. They visited a flagship store where possible,
quarter offer DPD, which has 2,500 points, 16% use UPS with each visited twice to ensure accuracy. Not all of the
Access Point, with 2,800 points, 12% use DHL Collection retailers have stores in London, and some are pureplay
Point, while 5% offer Doddle. retailers, but in total, researchers visited 140 stores.
Only 1% enable shoppers to collect their online orders Fifteen per cent of the stores visited were in shopping
from a locker that they own. That’s the same proportion centres, while the remaining 85% were in high street
as did so in 2019. locations with ground floor access. The largest group of
Cross-channel returns stores had one floor (43%), while 36.1% had two floors
Fewer retailers now enable shoppers to return their and 3.5% had six floors.
order to a branch of their own store, yet more now
How digital in-store works in practice
support returns via a third-party provider. In 2020, 43%
Researchers found that 43% of stores had wi-fi. Of those
of retailers enable shoppers to return their online order
stores with wi-fi, 34.8% required a password, and 58%
to a store. That’s down by 5pp on 48% in 2019. But a
required shoppers to register in order to gain access. 9%
quarter (25%)of the Top500 allow customers to return
of the wi-fi networks could be accessed via social media
their order to a third-party location. That’s up by 5pp
credentials, while 12.1% were offered by a third-party,
on the same time last year. Perhaps retailers find that
not directly by the retailer.
it’s more efficient for them to outsource the process, or
Staff were equipped with tablets in 19% of stores, and
perhaps using a third-party operator is likely to be more
staff in the same proportion of stores could reserve an
convenient for shoppers who decided to buy online rather
item available on the website but in that store for later
than in a store in the first place.
collection. Almost half (48%) of stores featured stationary
tablets that customers could browse. Customers were
signposted to a special desk or place to return items in
8.8% of stores.
Of all the stores, 18% featured in-store experiences
while the remaining 82% did not.
Payment
Shoppers could checkout using mobile payment in 6%
of stores, while 2% of stores signposted app checkout.
Self-checkout was available in 3% of stores, and the
retailer provided digital receipts for in-store purchases
in 15% of stores.

IN-STORE IN FOCUS
How the UK’s Elite retailers are

developing their store experiences
Finding new ways to bring shoppers in-store is key for retailers as online
continues to grow, writes Chloe Rigby
The role of UK stores is changing, with the Using existing stores as collection
RXUK Top500 Elite retailers at the forefront of and returns points
this change. At a time when customers want Next’s customers spent more online (£1bn)
to make more of their purchases online, all of with it than they did in its stores (£874.3m) in
the multichannel Elite retailers have rethought the six months to July 2019, but the clothing and
what their shops are for. These retailers are homewares retailer argues that its shops remain
responding to their own experiences which tell vital because so many of its shoppers want to pick
them that while shoppers often want to buy up or return orders there. Simon Wolfson, Next’s
online, at other times they want to visit a store. chief executive, explained in those results that 50%
Argos’ sales, for example, are often made of its online orders are delivered to its shops, while
online – it turned over £2bn from mobile 82% of returns are made via its shops. “It is counter-
transactions alone in its 2018/19 full-year. Yet intuitive,” he said, “but the fact is that stores have
most of its shoppers also visit a store in the become an important part of our online service,
course of their transaction, either to place or although their rents are way out of kilter with the
pick up an online order. Dunelm, meanwhile, has value they provide as collection and returns centres.
moved its online business to a new platform that So if stores are to remain open, retail rents must fall
enables it to offer new multichannel services and, fortunately, that is exactly what they are doing.”
such as click and collect. Dunelm, meanwhile, offers free click and collect
John Lewis says its customers spend more from 170 stores and enables shoppers to return
and remain more loyal when they shop across their online orders in-store as well. Marks &
a number of channels. But as spending with Spencer is looking to a ‘clicks and bricks’ future,
department stores quickly moves online – in which shoppers use both stores and online to
according to the Office for National Statistics, buy in the way that is most convenient for them.
16.8% of department store sales took place Shoppers at its Oban food hall, for example, can
online in December 2019 – John Lewis is use a fitting room to try on the clothes that they
focusing on the in-store experience to persuade buy using click and collect before deciding whether
shoppers to visit. to keep them. John Lewis enables multichannel
Online may have overtaken store sales at returns and collection both at its own stores, at
Next but the retailer says those stores still branches of Waitrose and at third-party shops.
offer valuable multichannel services. Marks & Argos’ digital format stores enable shoppers
Spencer is reconfiguring its store estate to adapt to order and collect items within hours, using its
to how its shoppers now want to spend with it. hub and spoke logistics model. About 300 of these
Eventually, it aims to make a third of its turnover stores are now located within branches of its sister
from the clothing and home categories online. supermarket, Sainsbury’s, while others are in
It is currently reducing its floorspace accordingly, locations including underground stations.
through both reducing the size of its stores Despite being an online-only retailer, Amazon
as well as closures. enables collection and returns to a range of
As these changes occur, here are three key third-party collection points and via its network of
ways that the RXUK Top500 Elite retailers have lockers, some of which are in third-party stores
developed their use of shops: such as Morrisons.

IN-STORE IN FOCUS
In-store experiences
John Lewis is focused firmly on experiences as
a way to bring visitors to its stores. In November,
the retailer opened its new look ‘customer centric’
Southampton store, which it described as an
‘experience playground’ where shoppers can
listen to talks and take part in workshops offered
by a team that includes interior designers, chefs,
wine experts, gardeners, gadget specialists,
personal stylists and make-up artists. The store
includes the first Waitrose Cookery School within
a branch of John Lewis. Peter Cross, customer
experience director at John Lewis & Partners,
said at the time, “Our goal is to offer customers
Copyright © John Lewis
unrivalled access to expertise and impartial advice

in as many areas of their lives as we possibly can
– in a way that is uplifting and inspiring.
“We know that shopping for a new gadget or
beauty product can be a daunting experience, John Lewis’ Southampton store is its first to have an in-store Waitrose Cookery School
with so much choice on offer. We want to help
navigate customers through that. Our new
concept shop is an example of how we’re
reinventing the department store of the future to it trialled a virtual reality and augmented
make us stand out from the competition.” reality experience, Visualise your Space, in its
At Marks & Spencer, 35 stores currently Kingston, Cambridge and Horsham stores to
offer a ‘fit and style’ personal stylist service in- help shoppers see how their interiors ideas
store that is designed to complement its online would look in their own homes. Caitlin Price,
styling service. John Lewis’ head of buying for furniture and
flooring, said at the time that customers find
it hard to go for bold looks because they are
In-store technology unable to visualise them in their own home,
Marks & Spencer has aimed to build more and instead revert to “safer” grey or beige
inspirational stores which feature digital furnishings. “This new technology will enable
technology while offering multichannel collection customers to be braver in their choices, and
and returns services. In 2018, it launched trials of test technology that architects and interior
‘mobile, pay, go’ payment that enable customers designers have been using to visualise their
in six of its convenience stores to avoid queues designs,” she said.
by completing their transaction on their mobile
devices. It has also deployed more than 7,000
mobile devices to enable staff to search for
products and get real-time stock updates, as well
as ordering items for customers.
Last year, Argos opened its first self-service
store, within Sainsbury’s Dulwich branch, where
shoppers browse the range and pay for the item
they choose via a tablet computer before picking
up their order at a new collection pod. At the time,
Sainsbury’s Argos chief executive, John Rogers
said, “We’re continuing to test innovative new
formats and, with the launch of our first self-service
digital store, we’re offering shoppers a speedier
way to pay, as well as giving our colleagues more
time to serve and help customers.”
Copyright © Argos
Dunelm’s store staff are equipped with tablet

computers which they can use to assist shoppers
who want to see the larger online range, or order
an item for in-store collection or home delivery.
John Lewis is also using digital technology Argos shoppers can browse and pay from a tablet, before collecting their goods
to attract shoppers into its stores. Last year, at a collection pod

FOCUS ON FULFILMENT
Delivery as a service
The way leading retailers deliver and enable collections and returns
provides a competitive advantage
In 2020, logistics is firmly centre stage

in the customer journey and experience,
enough to be flagged up by retailers in
their advertising and social media posts.
It’s a far remove from when fulfilment
was a strictly back-end concern. Today
super-convenient delivery, collections
and returns promises are powered
by strong order and warehouse
management and enterprise resource
planning systems. The perception is
Copyright © Argos
that customers often buy from a given

retailer based primarily on the delivery,
collections and returns experience.
But while leading retailers, including
those in the Elite and Leading groups of Argos puts delivery and collection front and centre of its website
RXUK Top500 retailers, have developed
such services, there’s evidence from
this year’s RetailX research that others that’s using their smartphone or in a minority. In 2020, 5% of Top500 retailers
are choosing to drop the services that digital format store – for delivery as offer same-day delivery, although 61%
may make less economic sense for quickly as same-day for orders placed offer next-day delivery, up from 58% a
them. Instead of offering nominated by 6pm. Shoppers appear very willing to year earlier.
day and time deliveries, many are pay for such convenience. In its 2018/19
choosing to offer a standard next-day full-year results, parent company
delivery service, or a choice of next- Sainsbury’s reported that use of Argos’ Convenient collections
day collections. Same-day delivery and £3.95 same-day delivery service had John Lewis was an early leader in
collections are very much the preserve grown by 13% over the year, while the offering convenient collections when it
of a few leading supermarkets and service could deliver to 90% of UK took the step of offering collections not
retailers. The others are concentrating postcodes within four hours. only from its own stores but also from
on making sure that their delivery Amazon has also focused on delivery those of its sister business Waitrose.
promise is both robust and profitable. as it has moved from cutting prices and It also offers collections through the
offering free delivery to a strategy of CollectPlus network.
convenient delivery. The retailer, like Argos’ fast collection service is also
Leading the way on delivery Argos, uses local hubs to ensure that proving effective. Shoppers can – and
Many of the thousands of products that stock is so close to customers that it do – pick up their orders within minutes
Argos sells are available elsewhere. can be delivered to Prime members in of ordering. Same-day collections rose
That’s why the retailer, ranked Elite as quickly as an hour. Non-members by 10% in its last financial year. In the
in Top500 research, has focused on can choose to pay for a range of eight Dulwich branch of Argos in Sainsbury’s,
competing on convenient delivery times. delivery services, or to pick up from shoppers can even browse and pay on
Its hub-and-spoke logistics model a collection point. There’s also free self-service tablets and collect orders
enables it to get products to shoppers delivery for those spending a minimum from dedicated pods.
as quickly as possible. Shoppers can amount who are willing to wait for their Amazon may not have a UK-wide
order online from anywhere – whether parcel. Both, however, are in a small network of stores but it offers customers

FOCUS ON FULFILMENT
a wide variety of collection options, from

local collection in third-party stores to
thousands of lockers around the UK, in
locations from airports to underground
stations and other retailers’ stores. Yet
Top500 research shows the proportion
of retailers offering click and collect
has fallen to 54% from 56% in 2019,
while only 19% offer next-day collection
– down from 26% in 2019.
Delivering the luxury touch

When shoppers are paying more for
their goods, they also expect more from
delivery. Shoppers in areas including
Copyright © John Lewis
central London can opt for same-day

delivery from Net-A-Porter, when
ordering by 10am – or same evening
delivery, when ordering by 2pm. They
can also select their own nominated day
John Lewis has prioritised making it easy for customers to collect their online orders
for delivery up to seven days. Same-day
premier services come with a £12 fee,
although shipping is free, at the time
of writing, on orders over £200. Other out in store. More third-party collection Sustainability matters
delivery options include next business points have sprung up in recent years, Many Top500 online and multichannel
day, while £5 standard deliveries are and RetailX research suggests that in retailers are now urgently rethinking
delivered within three days. More 2020, retailers are less likely to accept the way that they send goods out –
flexibility is offered through DHL’s returns in their own stores; availability from the packaging they use to their
on demand delivery service, where has fallen by five percentage points to transport fleet. Plastic bags are fast
shoppers can schedule their deliveries, 43%. At the same time, they are more being replaced with printed paper bags
leave it with a neighbour, or collect likely to enable their customers to and compostable wrappers. Amazon
from a DHL service point or parcel return an item via a third-party location has even experimented with doing away
locker. Customers then have 28 days to (+5pp to 25%). Perhaps any retailers with packaging altogether and sticking
return their order; free collection can that made the switch found it more address labels to product boxes.
be booked online. However, the retailer cost-effective to do so. Meanwhile, couriers are introducing
notes that high levels of returns could electric vehicles into their delivery
result in an account being closed. fleets. DPD, for example, has recently
Upmarket supermarket Waitrose Members-only taken delivery of what it believes is the
– whose Portishead branch used to Many retailers are now reserving the largest single UK commercial electric
deliver ‘to your yacht’ – has more best service for subscribers. Pureplays vehicle order to date – 300 electric
recently piloted in-fridge deliveries, such as Amazon and grocers Ocado and Nissan vans. That takes its total electric
through its While You’re Away delivery Tesco have led the way in this. Members fleet to 450 and it aims to reach 500 by
scheme. Drivers use smart locks and of Amazon’s Prime membership the end of the year. DPD chief executive
one-time codes to access customers’ scheme can get deliveries in as little Dwain McDonald said, “These vehicles
homes where, equipped with shoe as one hour, while shoppers at the are changing the way we work. It isn’t
covers and body cameras, they deliver supermarkets sign up to delivery pass just a case of plugging them in and
to the kitchen, even putting chilled schemes that enable them to pay saying, ‘Job done’. We are rethinking
items away in the fridge. once for free deliveries during peak and re-engineering how we deliver
or off-peak times. H&M’s loyalty club parcels now and in the future, with
members are encouraged to download different route networks and new types
Returns that work its app and get free collection plus free of depots. It is an all-encompassing
Shoppers at more than 100 retailers can delivery on orders worth £20 or more. revolution for our industry and electric,
return – and/or collect – their online It’s an approach that has certainly emission-free vehicles are at the heart
orders via supermarket Asda and its worked well for Amazon. In its 2019 of that vision. This enables us to say
Asda toyou service. First introduced full-year figures, it said that its £79 a to more and more customers, ‘We’re
in 2015, it can now be managed from year Prime scheme – which comes with delivering your parcels emission-free’,
a phone or from in-store screens, a range of benefits – had more than which is a key selling point when we are
where returns labels can be printed 150m members around the world. talking to retailers.”

CASE STUDY
HOW H&M IS CHANGING FROM GLOBAL TO LOCAL… SUSTAINABLY

In recent years, H&M has transformed the way it
does business. It’s gone from being a one-size-
fits-all global giant, to a retailer that still sells
around the world, but does so with a more finely
tuned local strategy. The fashion to homewares
retailer, ranked Leading in RXUK Top500 research,
is integrating its online services into its physical
stores and is putting customers in charge with a
mobile app that helps them connect with online
or their local shop – which ever is better for them.
Shoppers can now collect and return their online
orders at more and more stores as H&M rolls
out this strategy. They can also turn on ‘in-store
mode’ to search their local store for the products
they want to buy, even from a distance, using text
search and visual search. When customers are
already in the shop, they can scan clothes tags for
Copyright © H&M Group
more information. They can find out whether sizes

and colours are available in the store or online,
what the item is made of, how to look after it and
how to style it. Customers who sign up to become
H&M members can opt for free delivery, collection
and access to different ways of paying as the Shoppers can search products in their local store via the H&M app
retailer meets shopper demands while, at the
same time, getting to know its customers better.
“Our ongoing transformation work to meet
customers’ ever-increasing expectations is
bearing fruit,” said H&M chief executive Karl Johan
Persson in the company’s financial statement for
the first nine months of its 2018/19 financial year.
He added, “Looking ahead, we remain humble
considering the challenges brought by the rapid
shift in fashion retail. Our transformation work is
therefore continuing at a fast pace in all parts of
the company.”
At the same time, H&M is testing new and
innovative ideas, with a fresh emphasis on
sustainability. Shoppers at its new Stockholm
store, for example, can now rent skirts and
dresses from its Conscious Exclusive collections.
The store is designed to be more inspirational,
displaying images shoppers have shared of how
they wear H&M products. But it’s also convenient,
with payment available through self-service
checkouts. In the Netherlands, H&M is testing a
bicycle delivery option that’s particularly relevant
to that market. In the UK, shoppers can recycle
clothes at any H&M store, receiving a £5 voucher
in exchange for each bag.
H&M’s strategy is about getting closer and more
convenient for its customers. The figures suggest

that it seems to be working. Online sales grew by
30% in the first nine months of its 2018/19 year,
and overall sales by 12%, while pre-tax profits after
one-off costs were 25% ahead, compared to the
same time in the previous year. Shoppers can recycle clothes at H&M’s UK stores

CASE STUDY
WHY JD SPORTS STORES REMAIN VITAL AS THE RETAILER EXPANDS

ITS MULTICHANNEL SERVICE
JD Sports has moved upmarket and developed its
multichannel approach to retail – while growing
sales at the same time.
The retailer, ranked Leading in RXUK Top500
research, is at the heart of a wider JD Group that
turned in a 47% rise in sales in the first half of its
2018/19 financial year, including a 10% rise in like-
for-like UK sales. Pre-tax profits were also 30% up
on the previous year.
At the time, JD Sports executive chairman, Peter
Cowgill, said improved conversion rates reflected
“consumers’ increasingly positive reaction to our
elevated multichannel proposition, where a unique
and constantly evolving sports and fashion premium
brand is presented in a vibrant retail theatre with
innovative digital technology.”
Copyright © JD Sports
The JD Group says that JD Sports’ “elevated

multichannel” approach is attracting more premium
brands to sell in its stores, which in turn encourages
shoppers to visit. That means, it says, that its network
of shops – the group has more than 2,000 sports
fashion stores around the world – will remain as least
as important as they are now.
Those shops sit firmly in a multichannel context. JD
sells online in markets around the world, offering its
wares in local languages and currencies, while digital
is firmly embedded in its stores. In-store digital
devices such as kiosks, web tills and iPads all widen
the choice for customers visiting its stores. Visitors
can use them to see the full JD Sports range on the
website and see where items are held.
The in-store experience extends to the JD mobile
app – where users have the option of listening to JDX
Radio from wherever they are. Shoppers can search
the app for up-to-the-minute brand news. They can
view the latest product arrivals from premium brands
and can use live search to prompt an automatic list
of search queries that are trending at that moment.
Push notifications offer information on sales and
delivery offers. Customers can only sign up to JD’s
unlimited delivery service from within the app.
Meanwhile, fast, filter-led navigation is designed
to help customers narrow down their search for a
product, by size, colour, collection or price, while 360
spin images and product videos enable them to see
items up close. Users can scan barcodes for more
information or track their orders within the app.
Looking ahead, multichannel is set to remain a
Copyright © JD Sports
focus for JD Sports as it continues to develop its

customer experience and to expand its multichannel
services into new markets. Its international
business will be supported by a new warehouse
that’s expected to open this year in Belgium to The JD mobile app helps keep customers up to date with the latest
supply European markets in the wake of Brexit. news and products from the brand

BRAND ENGAGEMENT
RETAILX RESEARCH
How the RXUK Top500 fits into

RetailX research
The annual listing of UK Top500 retailers is now part of a wider and more
in-depth focus on the state of ecommerce and multichannel retail across Europe
The RetailX Top500 (RXUK Top500) this year has offer a wider and more international range of
a new name – one that reflects its position within goods. It will look at the performance, capabilities
the larger RetailX research and publishing stable. and trends of these direct-to-consumer
The new name for the listing of the UK’s leading marketplaces that are now a vital location in
retailers, previously called the InternetRetailing trading goods, and will assess how both retailers
Top500, comes in the sixth year of publication. and brands can most effectively use them.
It comes as RetailX research refocuses on an Sustainability is a new focus for RetailX
analysis of European and global ecommerce publications, and 2020 will also see the first RetailX
and multichannel retailing that’s at the same Sustainability Report. The report will look at what it
time wider and more in-depth. That analysis means to be sustainable when selling online, and
recognises the place of the UK’s Top500 retailers how retailers can help their customers to achieve
in a connected retail landscape that also includes the reduced carbon footprint that so many now
marketplaces and retail brands, and stretches prioritise. It will build on research already covered
beyond the UK to markets across Europe. in 2020 in a new eDelivery report, Sustainability
after the buy button 2020. That report looks at
delivery emissions and plastic waste and what
Beyond retailers retailers in the UK and Europe can do to reduce
Many online retail sales no longer take place from them - in a context in which shoppers seem
regular retail websites. Rather, as the Sankey chart enthusiastic about protecting the environment but
below shows, regular retailers see only about 34% have as yet done relatively little to change their
of UK web traffic to the Top500 according to data online shopping habits or to pay more to mitigate
researched in collaboration with SimilarWeb. the environmental effects of their purchases.
The largest share (45%) goes to marketplaces,
where a relatively small number of platforms see
almost half of all retail traffic that touches Top500 Beyond the UK
retailers. A smaller share (21%) goes to brands The next RetailX Europe Top500 will bring the
that sell directly to customers. Given these insights latest ranking of leading retailers selling in the 32
into the way that customers shop, it follows that markets of the EEA plus the UK and Switzerland.
RetailX would look further and more closely at As with previous editions, it will assess how
marketplaces and at direct-selling brands. The retailers and brands approach selling to a larger
annual RetailX Brand Index was published late geographic area where customers speak a wider
last year and looks at how brands take on the number of languages and buy in a wider number
challenges of selling directly to their consumers, of currencies, but with regulatory alignment
rather than via third-party retailers. It also lists the within a single market. Case studies analyse how
leading pan-European brands that sell across the the most successful retailers, including Allegro,
countries of the EEA plus the UK and Switzerland. Argos, Darty, H&M, Rue du Commerce and Zara,
Find out more about the RetailX Brand Index 2019 use ecommerce within their businesses. Find out
at internetretailing.net/rxbx. more about the RetailX Europe Top500 report at
In the coming year that will be followed by internetretailing.net/rxeu
the latest edition of the RetailX Europe Top500, Alongside this pan-European coverage, we also
and by the first RetailX Marketplaces report. report in detail on markets worldwide, through
The marketplaces report follows the shopper’s the analyst reports produced by the Netherlands-
attention as it’s drawn towards destinations that based Ecommerce Foundation, now part of the

RETAILX RESEARCH
FIGURE 13. THE RETAILX PORTFOLIO

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RETAILX SECTOR ANALYST REPORT RETAILX SECTOR ANALYST REPORT RETAILX SECTOR ANALYST REPORT
BEAUTY & COSMETICS FAST FASHION LUXURY 2019

INTRODUCTION
INTRODUCTION INTRODUCTION Welcome to the RetailX sector analyst
In 2017, Chinese consumers accounted for around a third of the personal luxury goods sector, reports, where we combine RetailX’s
Beauty & Cosmetics brands have long relied on celebrity endorsements to promote Fast Fashion has cemented its status as the driving force within the fashion industry. four years of in-depth company
Welcome to the RetailX Sector Analyst representing approximately four times the value of the total domestic luxury market in China.
products and department stores to sell products. This is changing. While the rise of online
Welcome to the RetailX Sector Analyst The sector emerged in the late 1990s when runway creations were quickly copied and Reports, where we combine RetailX’s performance research with analysis
Reports, where we combine RetailX’s introduced to consumers at a much cheaper price – a development enabled by cheaper The global market for personal luxury goods is forecast to grow to €290bn by 2020.
shopping has had less of a direct impact on the Beauty & Cosmetics sector than might four years of in-depth company per-
four years of in-depth company per- of the sector dynamics.
be expected1, department stores – a key physical channel to consumers for Beauty & Far Eastern supply chains. Coupled with increased internet penetration from the early formance research with analysis of the Between 2008 and 2017, the personal luxury goods market grew from €167bn to €262bn (5.1%
formance research with analysis of the Our reports provide the strategic and
Cosmetics brands – have borne the brunt of the shift to online retail. The indirect impact sector dynamics.
2000s, the legacy ‘two-season-fashion’ model (AW/SS – Autumn/Winter, Spring/Summer) sector dynamics. CAGR, 2008-2017), pushed by these Chinese customers. Yet in July 2018, fewer than 60% of
commercial context in which the best
on the Beauty & Cosmetics sector has been a loss of consumer coverage. turned into ‘evergreen fashion on steroids’. luxury websites offered a Chinese language version.
Our reports outline the strategic and retailers and brands perform in their
Our reports outline the strategic and
Beauty & Cosmetics companies have responded by investing in direct-to-consumer (D2C) commercial context in which the best So entrenched has the Fast Fashion approach become that even luxury and higher-end commercial context in which the best market sectors.
retailers and brands perform in their The luxury sector has been relatively slow to adapt to digital when compared to other retail
business models, as well as by setting up internal venture capital funds to capitalise on retailers and brands perform in their fashion brands have developed monthly product “drops” (high-profile limited releases We have two reports each year: The first
market sectors. sectors. In this report, we review the digital-first startups, along with established brands, that
the potential from startup brands and technology vendors. Disruptive startups, such as market sectors. of products) as a marketing hook, rather than their more sedate biannual seasons. are now embracing digital. is our Analyst Report, focusing upon
Revolution Beauty, are challenging the status quo by adopting Fast Fashion techniques. the current performance and sector
Fashion retailers increasingly include a limited range of Fast Fashion products within their
dynamics. The second is our Strategic
YouTube, Instagram and other social media platforms have impacted on how consumers Let us know of sectors you would like to overall mix fast items and seasonal continuity. This is a marketing necessity to entice Let us know of sectors you would like to SHARELINES:
see us cover: research@retailx.net Report, which looks through a strategic
perceive celebrity, leading to the rise of social influencers. Some of these have gone on see us cover: research@retailx.net customers to visit stores or websites, even if those products are sold at break-even or a
Chinese consumers spend one in every three dollars spent on personal luxury goods globally planning lens at the 2-5 year outlook –
to develop their own product ranges, notably Huda Kattan, who in 2018 was ranked 37th loss. This is not to be confused with retailers that have made Fast Fashion a profitable showing glimpses of the future in the
business approach at scale. Europe accounts for 33% of the global personal luxury market, yet only 19% of total luxury
on the Forbes list of America’s richest self-made women2. current practice of the best.
sales are attributed to Europeans!
DEFINITION The full schedule of 2019 Sector Reports
SHARELINES SHARELINES The pre-owned segment is a growing aspect of the luxury market
DIRECT-TO-CONSUMER OR D2C COMMERCE can be seen at retailx.net/reports
The rise of ecommerce has only indirectly impacted Beauty & Cosmetics is when brands sell or promote their The advent of social media has dispersed and democratised celebrity Pureplay luxury retailers’ share of all online luxury sales has declined to around 25% Let us know of sectors you’d like to
products directly to consumers rather than Consumer concerns about sustainability do not appear to have slowed the see us cover – research@retailx.net
Celebrity marketing has been disrupted and diluted by the rise of influencers via wholesalers and retailers. market’s growth
The companies covered in this report are, on average, 100+ years old
ONLINE SALES In 2018, these represented The Japanese automotive industry’s Just In Time (JIT) manufacturing method
Leading Beauty & Cosmetics companies are now operating internal VC funds c12.5% of the Beauty & Cosmetics market influenced Fast Fashion TL;DR OUR ANALYST
Augmented reality (AR) applications are gaining traction in Beauty & Cosmetics worldwide. Sales patterns vary by territory. THOMAS ANDERSSON
For example, in China, consumers made
Zara is a frontrunner in the Fast Fashion industry The internet abbrebviation ‘TL;DR’ means ‘Too Long; Didn’t Read’. In that spirit, here are
The Fast Fashion business model is being reinvented in the cosmetics space
23% of all beauty retail purchases online in From luxury to value brands, Fast Fashion has permeated the industry some consideration points from this report:
2017 (source: Credit Suisse). Sector leader Fast Fashion’s growth was aided by several market drivers, while its continued Thomas is a retail sector analyst with
• The luxury sector grew 5.1% CAGR (Compound • Luxury brand owners have exploited their
1. https://fashionista.com/2017/05/beauty-products-packaging-shopping-habits L’Oréal disclosed that 11% of its sales were
2. www.harpersbazaar.com/uk/beauty/a26320975/influencers-beauty-collaborators-brands/ growth is challenged by a mix of inhibitors over a decade of experience starting and
generated online in 2018.
Annual Growth Rate) between 2008 and 2017 divesting a multichannel retail business. He
financial power (Richmond’s acquisition of
is a grants evaluator for Vinnova, a Swedish
TL;DR (€167bn to €262bn) YNAP) and flexed IP (24sevres.com - LVMH) R&D government agency.
TL;DR The internet abbreviation ‘TL;DR’ means ‘Too Long; Didn’t Read’. In that spirit, here • The personal luxury goods market is predicted • We profile the luxury groups (the Multibrands) thomas@retailx.net.
The internet abbreviation ‘TL;DR’ means ‘Too Long; Didn’t Read’. In that spirit, here are some consideration points from this report: to grow to €290bn by 2020 MARTIN SHAW
THOMAS ANDERSSON and provide dashboards for their trading fascias
• market • Chinese consumers have become a major force • Our 23 companies offer four languages each
THOMAS ANDERSSON
are some consideration points from this report: thomas@retailx.net Fast Fashion’s growth has been due to them to meet customer demand. HEAD OF RESEARCH,
thomas@retailx.net
• been Thomas is a retail sector analyst drivers, including Just In Time Inditex’s produced a limited volume RETAILX
Beauty & Cosmetics companies have new influencer-driven brands. This has Thomas is a retail sector analyst and now account for one in every three luxury
manufacturing process, globalisation, of different lines to create a high on average, with English, French, German and
indirectly impacted by the shift to recently extended into technology experience starting and divesting a multichannel
purchases globally. While the emergence of the
multichannel retailing but the effect on investments, such as L’Oréal’s acquisition retail business. He is a grants evaluator for low-cost supply chains, rising Internet throughput of different garments. experience starting and divesting a multichannel
Chinese the most frequent
Martin devises the scope and methods of
retail business. He is a grants evaluator for online channel has increased the reach and
Vinnova, a Swedish R&D government agency penetration, increasing household Inditex’s interpretation – Fast Fashion – RetailX’s research.
department store chains, traditionally
a key retail channel for the sector, has
of Modiface, a technology it recently
used to promote its brands on Amazon MARTIN SHAW disposable income, historically low revolutionised the fashion industry
Vinnova, a Swedish R&D government agency.
growth prospects of luxury brands, it has also • Our semantic analysis shows the growing use martin@retailx.net.
• 2000s,
MARTIN SHAW
• important
been far greater. This has affected the martin@retailx.net interest rates, and the near-shoring of Online shopping’s growth in the of digital retail terms in the listed companies’
Acquiring D2C brands has become an martin@retailx.net increased costs
visibility of Beauty & Cosmetics brands Martin devises the scope and supply chains low-cost manufacturing and
CEO: Ian Jindal
• impact
tool for the larger Beauty & methods of RetailX’s research
• sustainability
Market inhibitors include concerns about near-shoring combined to make Fast
Martin devises the scope and
methods of RetailX’s research. • While Chinese luxury consumers have driven Annual Reports, 2008 to 2017 HEAD OF RESEARCH: Martin Shaw
• The circular economy – second-hand or

Social media has had a fundamental Cosmetics companies as they evolve SENIOR ANALYST: Thomas Andersson
on the sector. The rise of their business models and labour conditions, Fashion mainstream growth in the sector, it is prone to volatility based COMMERCIAL DIRECTOR: Andy James
• have
CEO: Ian Jindal DESIGN: Marzena Zychowicz
• D2C,
influencers has diluted the marketing CEO: Ian Jindal and supply chain exposure to political Sustainability and labour concerns on domestic and international events (a Chinese ‘recommerce’ – is a new opportunity in luxury, ADDRESS: RetailX, 123 Cannon Street,
RetailX forecasts a further move towards Head of Research: Martin Shaw
power of celebrities while increasing the Head of Research: Martin Shaw uncertainty on free trade and tariffs not to date had a major impact Senior Analyst: Thomas Andersson London, EC4N 5AU
which will continue as the relative
• around
Senior Analyst: Thomas Andersson government crackdown on graft; the cooling of covering items from luxury cars to vintage
number of relationships that brands need importance of ecommerce over the Commercial Director: Andy James
Benetton and Inditex adopted JIT on Fast Fashion retailers, nor overall Editors: Chloe Rigby, Jonathan Wright
© 2019 RetailX Limited
Commercial Director: Andy James US-Sino trade relations) watches
to manage high street grows. This move will be Design: Marzena Zychowicz the same time but interpreted customer demand. However, Fast Design: Marzena Zychowicz
• Beauty
In the last five years, four of the Top 10
& Cosmetics companies have
further accelerated by entry into new
geographical markets where there are
Address: RetailX, 123 Cannon Street
London, EC4N 5AU
the processes differently. Benetton
produced large volumes of a narrow
Fashion retailers now sell ‘sustainable
collections’ to cater to this growing
Address: RetailX, 123 Cannon Street
London, EC4N 5AU
RXS03: Published in London, © 2019 RetailX Limited. www.retailx.net Page 1 of 24
created internal venture funds to acquire no historical reseller relations
© 2019 RetailX Limited set of SKUs in raw form and dyed consumer preference. © 2019 RetailX Limited
RXS009: Published in London, © 2019 RetailX Limited, www.retailx.net Page 1 of 28 RXS004: Published in London, © 2019 RetailX Limited, www.retailx.net Page 1 of 29
RetailX family. During 2020, the Ecommerce analysis of sector dynamics to help retailers better
Foundation Country and Regional Reports will understand the current state of each sector and
include information on the performance of top plan for the next five years. Find out more about
retailers and brands selling direct to shoppers the sector reports at retailx.net/sectors.
within each market, alongside analysis of the
sector and of related economic and market drivers.
Recent Ecommerce Foundation reports FIGURE 14. MARKETPLACES RECEIVE A DISPROPORTIONATE AMOUNT OF UK WEB TRAFFIC
are currently available on markets including This chart shows the UK web traffic to the websites of the Top500
India, Australia, China and the USA, while an
Microsoft 13%
exhaustive Europe-focused programme of
Apple 2%
reports is planned for the coming year. The first Other brands 6%
two will cover the Danish and UK markets. Find
Amazon 25%
out more about the country and regional reports
at retailx.net/countries. Brands 21% eBay 18%
Marketplace AliExpress 1%
Other marketplaces 1%
hosts 45% BT Shop 3%
Across sectors Other Argos 2%
Tesco 1%
RetailX analyst reports focus on individual retail retailers 34% John Lewis 1%
sectors to give our audience of ecommerce and Google 1%
Asda 1%
multichannel retail professionals new levels Asos 1%
Currys PC World 1%
of insight into the factors driving customer Marks & Spencer 1%
behaviour, and retail performance within each. Screwfix 1%
Steam 1%
The latest sector reports are on beauty and Ikea: 1%
Sainsbury's 1%
cosmetics, fast fashion and luxury. Each provides B&Q 1%
the strategic and commercial context in which the Next 1%
CeX 1%
best retailers and brands perform in their market Others 15%
sectors. They combine more than four years of
in-depth company performance research with Unique web visits researched in collaboration with RetailX knowledge partner SimilarWeb

DEFINITIONS
WHAT CONSTITUTES A RETAILER?
TABLE 9. DEFINITIONS
The multichannel landscape is more complex than merely ‘having a website’ or ‘operating a store’. In choosing which companies to
include in the RetailX Top500, we have considered companies’ intent, capabilities and activities around the recruitment and monetisation
of customers. The definition of a ‘retailer’ for inclusion in our research is:
DESTINATION: the retailer has created a destination that, in the minds of customers, is a source of product, service or
experience. Whether this destination is a shop, a site, a place, a time or an event, it’s the sense of ‘locus’
that counts.
FASCIA-FOCUSED: the assessment focuses on individual trading names, rather than a parent company that may operate more
than one brand. Since the group structure is invisible to customers, it does not have a bearing on the position
of brands owned by a group. The challenge is to turn group capabilities into trading advantages that the
customer would notice across brands.
PURPOSE: the retailer has created goods and/or services for the specific purpose of selling, for consumption by the
purchasing consumer.
MERCHANDISING: the retailer actively sells and is not just a portal for taking customers’ money. This means the selection,
promotion and tailoring of retail offers for customers.
ACQUISITION: the retailer actively markets, recruits and attracts customers with a promise or proposition to the destination.
SALE: the retailer takes the customer’s money. The retailer owns the transaction as the merchant of record.
RECOURSE: the retailer is responsible for the service, fulfilment and customer satisfaction owing from the sale.
EXCEPTIONS: in every good list there’s an exception, where we may include a certain business due to its influence upon
retailers and retailers’ customers. Some of these companies will be included within the Top500 and others
are tracked for information on their impact on retailers.
COMPANIES EXCLUDED FROM THE TOP500
MARKETPLACES: where a candidate retailer is simply a marketplace, the company is not featured. Where a marketplace
undertakes customer acquisition, manages payment, customises offers and recommendations and offers
recourse on purchases, then the company will be eligible for inclusion.
PURE TRANSACTION/TARIFFS: where ecommerce is ancillary to the primary purpose of a business, we will not necessarily include them.
Online payment for gas or electricity is excluded since the purpose here is to supply energy. Travel companies
are not included in the Top500. We have also excluded media-streaming services.
BUSINESS-TO-BUSINESS AND while the scope of retail is normally direct to consumer, two trends are challenging this – the move for brands
DIRECT-SELLING BRANDS: and previously solely B2B businesses to sell direct to consumers; and the increasingly retail-like behaviour
of B2B brands, in terms of acquisition, promotion, personalisation and service. We have therefore included
certain B2B businesses and direct-selling brands.

RESEARCH PARAMETERS
SUMMARY OF ELEMENTS INCLUDED IN EACH DIMENSION:
TABLE 10. OUR METRICS

0. FOOTPRINT DIMENSION
0.1 UK retail turnover, ranging from £1m to £56bn – average £760m
0.2 The ecommerce subset of the above, ranging from £500,000 to £10bn – average £350m
0.3 UK web traffic, ranging from 380,000 to 4.4bn page views per annum – average 87m views per annum
0.4 Number of UK stores, ranging from 0 to 11,500 – average 124 stores
1. STRATEGY & INNOVATION:

1.1 Strategic practice, including an expert-designated selection of metrics that catalogue a retailer’s embrace of technological or
organisational best practice
1.2 Innovative practice, including a selection of metrics from other Dimensions that, to date, are only used by the leaders
2. THE CUSTOMER:
2.1 Customer service response time and helpfulness – Facebook and email
2.2 Desktop and mobile homepage performance, including engineering and responsiveness
2.3 Mobile and desktop website navigation – the ease of finding a desired product, including tabs, icons, search and filtering
2.4 Customer feedback – incorporation of customer reviews and product ratings on the product display page
2.5 Mobile app – the incorporation of customer reviews and product ratings in mobile app product display pages and the
personalisation, performance and user experience of apps [retailers with mobile apps]
3. OPERATIONS & LOGISTICS:

3.1 Delivery capability including 10 metrics covering the range of options, and competitiveness of timeframes and pricing
3.2 Returns capability, including 10 metrics covering the ease of the returns and refund process to the customer, and the range of
options, including return to store
3.3 Collection capability, including nine metrics covering the number, type and convenience of collection locations and the costs and
timeframes of the services
3.4 An assessment of the mobile website’s usefulness to customers who want to see the availability of stock, both for ecommerce
orders and in local stores
3.5 Mobile app – visibility of stock availability and locations in the app [retailers with mobile apps]
4. MERCHANDISING:
4.1 Customer-perspective review, including 23 metrics covering design, navigation, the relevance of search results, product information
and visual appeal
4.2 Mobile app assessment, including nine metrics covering use of notifications, product display and personalisation [retailers with
mobile apps]
4.3 Merchandising and product review, including number and depth of promotions, the fraction of a retailer’s range with reviews and
descriptions, the number of images per product and the fraction of range that is out of stock [largest retailers]
5. BRAND ENGAGEMENT:
5.1 Social media presence and availability, including 22 metrics, taking into account size of audience and interaction with it on Twitter,
the net change over three months and use of 10 social networks, email, and blog
5.2 Mobile and desktop website review – assessing the integration of social media, sharing and social validation
5.3 An assessment of mobile apps’ incorporation of social media [retailers with mobile apps]
5.4 Brand-name keyword searches – total and YoY increase by UK consumers
6. MOBILE & CROSS-CHANNEL:

6.1 Mobile home page performance, including engineering and responsiveness
6.2 Mobile website assessment, including the use of screen real estate, the ease of navigation and the ability to track the availability of
goods at physical stores
6.3 Multichannel features, taking into account use of physical store estate for order fulfilment and return, store information on the
website, in-store functions of apps and cross-channel loyalty accounts [retailers with stores]
6.4 Mobile app, including 24 metrics, measuring the usability and functionality of apps
6.5 Digital store assessment of the Top150’s London stores.

KNOWLEDGE PARTNERS
THANK YOU
Our thanks go to our title sponsor Klarna for helping us to bring our insights and findings in
this report to professionals working in ecommerce and multichannel
KLARNA.COM
KNOWLEDGE PARTNERS
RetailX would like to thank the following Knowledge Partners for their original data insights
as well as support, advice and guidance in producing the RXUK Top500.
builtwith.com eggplantsoftware.com
pi-datametrics.com similarweb.com

CONCLUSION
In conclusion
This year in retail will inevitably be dominated by However, there’s one final, and perhaps more
the UK’s departure from the EU – and by planning upbeat, point to make. That to reiterate our findings
for the arrangements that are to follow the end of from the pages of this report that continue to show
the transition period in January 2021, once agreed. retail performance steadily improving across the
Brexit has now moved from general uncertainty wide-ranging metrics that RetailX researchers
to specific uncertainties. Previously there was some map. As last year, it’s not just the Elite and Leading
expectation or hope that Brexit would either not retailers who show these steady improvements, but
happen at all or would happen as a ‘soft’ rather than the Top500 as a whole. And as last year, it’s clear
a ‘hard’ Brexit. Both would have had the effect of little that businesses are moving away from features
or no change to customs, tariffs and immigration that perhaps do not work as well or as profitably for
rules. The general uncertainty of that time has now them as they might have expected, while doubling
gone, shown to be a phony war. Now the ecommerce down on those that do. To take just one example:
and multichannel retail sector is faced by specific while more are offering next-day delivery, fewer
uncertainties around labour, skills, imports, exports now enable next-day collection. This illustrates a
and the wider supply chain. Each of these represent mature, evolving industry that, we would argue, is
a specific challenge to retailers as they re-examine now very well-placed for whatever comes next.
the costs and methods of doing business. After As the next chapter unfolds, we’ll be continuing
2020, selling abroad will have new meaning. our research both in the UK and across the wider
At this point we’d be delighted to be able to give European market. And, as always, we’re interested
words of comfort or specific advice on dangers to in how we can extend our research and improve
avoid and opportunities to take. But at the time the quality of our findings. Get in touch with ideas
of writing, all we can say is that the work is to be and potential datasets via research@retailx.net or
done, rather than having been done. tweet @RetailX.
EDITOR: © RetailX Limited, 2020.

Editor CHLOE RIGBY
This report may not be stored in a retrieval system, distributed or sold in whole or in part without
Editor-in-Chief IAN JINDAL the publisher’s express permission. Fair quotation is encouraged, with a link to the report’s URL on
DESIGN: RetailX.net or InternetRetailing.net. All charts and figures marked with are provided
under the Attribution-NoDerivatives 4.0 International (CC BY-ND 4.0) license
Design Manager JULIA WEBBER (https://creativecommons.org/licenses/by-nd/4.0/). You are welcome to use these in full with a
MARKETING: link to this report, retaining the copyright notice
Marketing and Circulation ADDISON SOUTHAM This report is based upon our reasonable efforts to compile and analyse the best sources available
membership@internetretailing.net to us at any given time. Opinions reflect judgment at the time and are subject to change.
SALES:
Commercial Director ANDY JAMES
andy.james@internetretailing.net RetailX at InternetRetailing Media Services Ltd
Group Creative Solutions Director MARVIN ROBERTS 123 Cannon Street,
marvin@internetretailing.net London, EC4N 5AU
Tel: +44 (0) 20 7062 2525
RESEARCH:
Printed in Great Britain.
Head of Research MARTIN SHAW ISSN 1759-0582
Research Project Manager FERNANDO DOS SANTOS www.retailx.net

RXUK
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RXUK

UK TOP500 REPORT 2020

Join the thousands of UK retailers who are already

From the editor-in-chief

© 2020 retailx.net, distributed by InternetRetailing.net February 2020 3

TABLE 1. OUR METRICS

4 February 2020 © 2020 retailx.net, distributed by InternetRetailing.net

MEET THE TEAM

CHLOE RIGBY FERNANDO DOS SANTOS

MARTIN SHAW IAN JINDAL

© 2020 retailx.net, distributed by InternetRetailing.net February 2020 5

ELITE TOP 100 TOP 150 TOP 250 TOP 250

TESCO JACAMO MARISOTA FOOT LOCKER PRETTYLITTLETHING

6 February 2020 © 2020 retailx.net, distributed by InternetRetailing.net

© 2020 retailx.net, distributed by InternetRetailing.net February 2020 7

Fashion accessories 211

8 February 2020 © 2020 retailx.net, distributed by InternetRetailing.net

FIGURE 4. HOW THE TOP500 HAS PERFORMED SINCE 2016

Home and industrial appliances

Top350 Top150 Top50 Elite Direct-selling brands

© 2020 retailx.net, distributed by InternetRetailing.net February 2020 9

it’s FREE for retailers

Sector Reports Blue Papers

Learn from and

RXS009: Published in London, © 2019 RetailX Limited, www.retailx.net Page 1 of 28

benchmark against the

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and frequency. Country Reports Whitepapers

By developing a membership platform for

you’re browsing the site.

relevant and useful to your business. eBooks

Looking for Corporate Membership Packages? Any question at all?

Collaboration – the key

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A story of customer obsession

Amazon is, by almost

time when shoppers did – and still do –

12 February 2020 © 2020 retailx.net, distributed by InternetRetailing.net

© 2020 retailx.net, distributed by InternetRetailing.net February 2020 13

14 February 2020 © 2020 retailx.net, distributed by InternetRetailing.net

NEW AND BUBBLING UNDER

TABLE 1. NEW THIS YEAR

TABLE 2. BUBBLING UNDER

© 2020 retailx.net, distributed by InternetRetailing.net February 2020 15

The factors driving change in UK retail

‘In the ever-changing landscape

16 February 2020 © 2020 retailx.net, distributed by InternetRetailing.net

both for retailers, who are used to managing

replacements to single-use items, from bamboo

© 2020 retailx.net, distributed by InternetRetailing.net February 2020 17

The Top500 crowd is starting to catch up with the

18 February 2020 © 2020 retailx.net, distributed by InternetRetailing.net

FIGURE 8. MORE MOBILE APPS HAVE PREDICTIVE SEARCH THIS YEAR

Sports and outdoor equipment +5pp

Trade tools and equipment and DIY +10pp

Footwear: Fashion +16pp

Fashion accessories +16pp 2019

0% 20% 40% 60% 80%

Below, we look in depth at retail performance