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On the rocks

On the rocks

How different business sectors have weathered the storm

The unique market conditions created by lockdown have brought about some clear winners in the UK business landscape. Anyone who struggled to buy toilet paper, pasta, baking ingredients, garden supplies or hair clippers knows there were certain peaks in demand that were unique to life in lockdown in 2020.

As people sought novel ways to give themselves a “pandemic pampering”, online beauty sales doubled in just 12 weeks (as highlighted by Kantar’s Worldpanel division data) with nearly 9 percent of Brits buying beauty items via e-commerce in May. The shift means the pandemic accelerated the sector’s shift to online by as much as four to five years. The closure of hair salons fuelled 43 percent growth in hair colourants.

Similarly, without pubs and restaurants to go to, consumers sought solace in a few beers or G&Ts at home, sending take-home alcohol sales soaring. Even once pubs reopened, over half of consumers said they felt uncomfortable about going out, and alcohol sales for home consumption remained 41 percent higher than usual in early July.

More home cooking (and home snacking) meant people were buying not just more food and drink (13 percent up between June 2019 and June 2020), but also more calorie-dense products, with total calories purchased around 17 percent higher than a year ago. Grocery retailers were the big winners, but with the closure of schools and workplaces leading to 500 million additional meals being catered for at home, the allure of a takeaway was strong.

These shifts in demand are also evident in the BrandZ Top 75 data. The soft drinks and alcohol categories were both up, and with cafes and restaurants shut, the food delivery services (classified as lifestyle platforms in BrandZ) were big beneficiaries, growing in value by 27 percent. Given that sporting events were virtually non-existent for months, gambling brands suffered big losses (-34 percent), as did clothing (-20 percent), cars (-32 percent) and travel (-27 percent).  

What is important to note here is this: with the possible exception of luxury, which suffered a body blow seemingly out of the blue when retailers were forced to shut physical stores, brands generally continued in the same direction they were moving in before COVID-19 struck. What changed was the scale of gain or loss, but not the direction, as this look at just a few categories neatly illustrates.

Note: Top 50 is used for consistency, as the UK ranking began with 50 rather than 75 brands

A day in the life – BrandZ ranking reflects UK consumer experience

The category make-up of the Top 75 has changed little since last year, with banks, telecommunications providers, retailers and energy suppliers accounting for the vast majority of brand value. The remaining one-third of value comes from a broad selection of brands spanning everything from computer gaming to personal care, paint to price comparison, and cars to chocolate. In short, they provide a snapshot of everyday life in the UK.