LiveArea blasts Primark reliance on physical stores

Primark’s digital denial is reminiscent of Sony’s naivety during the Betamax and VHS format war, according to Elliott Jacobs, EMEA Commerce Consulting Director at LiveArea.

The retailer was hit hard during the coronavirus lockdown period, with the closure of its stores leading to a loss of £650 million worth of sales every month. It dipped its toes in e-commerce waters during 2013 via Asos, but eventually decided to pull the plug.

This resistance to an online channel is frankly baffling, Jacobs argues. “In Sony’s case, it went from owning 100% of the market to just 25% in six years, watching more agile competitors steal market share,” he says.

“Fast forward five or ten years and we could be looking back at Primark as a case study of a failed retail strategy – a huge business with a dominant market share that was too stubborn to diversify its routes to consumers.”

“Most retail experts agree that consumer behaviour has changed forever. McKinsey estimates that consumer and business digital adoption has been accelerated by five years. Primark’s strategy, relying upon the assumption that high street footfall will return to its pre-pandemic levels, is unnecessarily risky,” Jacobs concludes.

Primark did not respond to our request for comment.

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