A dramatic rise in online shopping is expected to send courier and delivery sales soaring this year. Latest research from Mintel estimates the market will achieve annual growth of 23% in 2020; the biggest annual increase since 2015, when the growth rate was 17%.

Demand for courier services was already booming before Covid-19, with the value of the market increasing by 44% between 2014 and 2019 from £7.6 billion to £11 billion. By the end of this year, estimates are that it could reach £13.5 billion.

And this growth is set to continue. According to Mintel, the sector’s market value is forecast to increase by 92% between 2019 and 2024, reaching £21 billion.

The boom in courier and delivery service comes as 42% of Brits say they have done more online shopping since the start of the pandemic.

Commenting on the research is Mintel research analyst, Francesco Salau. “The likelihood of ongoing social distancing measures should benefit the courier and delivery industry. An increase in homeworking meaning that the inconvenience of having to ensure that you are at home to receive large deliveries becomes less of a pain for consumers.

“In the long-term, the steady rise in ecommerce sales, increasing sophistication of delivery services, and the growth of delivery subscription services should outweigh the damage done to the sector by a slowing economy.

“Health and safety has become a key concern for both consumers and courier workers, with major couriers quick to demonstrate awareness of this by offering contactless delivery and equipping the sector’s workers with protective equipment.

“This will speed up trends that were emerging prior to the crisis. Such as drone delivery and technologies that allow couriers access to car boots and smart ‘drop boxes’ outside consumers’ homes.”

Older consumers will be a driving force in market growth in the short/medium term.

Many older consumers have had to engage with online retailing; forming part of the population especially at risk from Covid-19 and as such, demonstrating the highest concern about exposure.

According to Mintel’s research, over half (56%) of over-65s worry about exposure to the virus. This is in comparison to just 40% of 16-24-year olds. Meanwhile, over-65s are increasingly going online for their shopping requirements.

Before the lockdown, this age group was the least likely to shop online. In May 2019, just 16% of those age 65+ shopped online at least once a week. This is in comparison to over half (54%) of consumers age 25-34, who were the most frequent online shoppers.

Following lockdown, over-65s are as likely as the average consumer to have shopped more online since the start of Covid-19.

Generation Z and Millennial consumers are the driving forces of online shopping. Just under two thirds (63%) of under-45s own a delivery pass subscription. For instance, for Amazon Prime and ASOS’ Premier Delivery service. This is compared to over one third (36%) of over-45s.

While key consumers, these younger Brits are likely to be more vulnerable to the risk of unemployment, which will hugely impact on their spending. Around four in ten (38%) 16-34-year-olds are also cutting back on non-essential expenses. This is in comparison to around three in ten (31%) over-65s.

“A generational divide will arise as a result of Covid-19,” continues Salau. “Many older consumers have been forced to engage with online retailing as they’re part of the population especially at risk from the pandemic.

“While Generation Z and Millennial consumers are likely to continue to be the driving forces of the market as the leading online shoppers, they will also be more likely to be cutting back on non-essential spending than older groups.

“As a result, online retailers, and indeed courier services, are more likely to rely on new business from older consumers in the short to medium term.”