Virgin Media to make COVID-19 retail closures permanent

Virgin Media has made the decision to remove itself from the high street, permanently closing its 53 retail stores which have been shut during the COVID-19 lockdown period.

Trends have been shifting away from in-store purchases for years, and it appears the pendulum has swung far enough for Virgin Media. None of its 53 retail locations will be reopened following the period of lockdown, with the 341 employees all being offered alternative roles in the business.

“We are focused on delivering the service customers want, in the ways they want it and at a time and a place that suits them,” said Rob Orr, Executive Director for Sales at Virgin Media.

“By creating new jobs in our most popular care and sales channels, we will be better able to provide our customers with the top service and support they rightly expect while retaining our talented workforce.”

Virgin Media has said at least 300 new customer service roles would be created to compensate for lost in-store roles, the majority of which will be work-from-home roles. The majority of sales already take place over the phone or via other digital channels.

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Virgin Media is the first company to make such an announcement, but we suspect there will be others. We are not necessarily limiting our assumption to the telecoms and technology industries, but this lockdown has shown that operations can continue with physical shops or offices, therefore digital transformation programmes might be encouraged.

Looking specifically at the telco space, Vodafone is currently working on a phased reopening plan for post-lockdown, and although it cannot guarantee it will be able to reopen every location, that is the plan. BT will also implement a phased reopening strategy, opening as many locations as Government guidance will allow for.

At the time of writing, O2 and Three had not responded to emails from Telecoms.com.

There might of course be accountants and strategists who would want to close down physical sales channels, digital is much more profitable after all, but this is unlikely to be the case for mobile network operators.

As many customers would be interested in seeing and holding a smartphone before signing a £1000 cheque, a retail presence would be desirable. Closing down these shops might encourage customers to look at devices elsewhere, which might mean losing a postpaid customer. It is a delicate balance, but perhaps a necessary cost, at least for the moment.

Virgin Media is in a different position; how many people want to inspect a router prior to buying a broadband package. It might sound like a negative for the business, but realistically it probably is an unnecessary expense. COVID-19 was probably a contributor to the decision to permanently closing the high street present, but we suspect executives have been discussing this for some time.