Retail has been one of the most impacted industries of the COVID-19 pandemic. With mass lockdowns governments have implemented world-wide to slow the spread of the virus, most non-essential retail locations have closed and are now only trading online. This change did not come about in a matter of years or months, but in weeks and, in some extreme cases, days. The industry’s ability to react and adapt has been limited by the unprecedented speed and magnitude of this change. Some businesses have literally gone from almost normal trading and revenue to zero revenue and zero trading overnight. Retailers that are deemed essential and are still trading are struggling with limited supply chain capacity and erratic consumer demand.
Businesses had to take drastic measures to cut cost, change priorities and seek outside help from governments. In conversations we have been having with retailers, besides immediate steps all businesses had to take, one common questions has emerged:
How can I adapt my trading practice for the days after COVID-19?
Life after COVID-19 lock down will not be the same as before. Even though people will return to work, to schools, and to life in general, the public, for good reasons, will be far more careful on how they interact with their favorite brands. Shifting trade to a purely online channel seems like a logical next step, however, should not be the only option. Brick and mortar channel will still very much be a part of trading in the future: people will still want to go outside and shop in person, to see and try goods for themselves before they buy. However, how they do their shopping will change.
China, where COVID-19 shutdown has started earlier than the rest of the world, is now in the process of easing restrictions and opening schools, factories and shopping malls. City streets are busy and people are venturing out again. The level of road traffic and mass transit saturation has yet to reach pre-COVID days, nevertheless retail footfall and store revenue has grown significantly. Almost all people are wearing masks however. People are encouraged to keep a safe distance from each other and avoid crowding whenever possible. People are checked frequently for their temperature and entry to confined spaces, including shopping malls, has been controlled to avoid overcrowding inside. Mass transit traffic has been recovering slowest for fear of a resurgence in infection rates. Mobile applications are also growing in visibility (not necessarily popularity) that are meant to help people and authorities track movement of individuals and identify contact history and movement patterns to help limit the chance of a second outbreak of the virus.
To understand what the future of retail is, the motivation of both individuals and authorities needs to be considered. Both are aligned on the desire to avoid future outbreaks. That means we all need to take certain precautionary steps into our daily routines: measures as simple as frequently and thoroughly washing hands after direct contact with just about anything, keeping a safe distance from others and avoiding crowds is a good start. The impact of these precautionary measures will affect how we shop and engage with others. To facilitate compliance with these measures, retailers will need to implement changes in their brick and mortar channels while preserving the aspects of shopping in person that differentiate it from a purely online experience.
Such changes are focused on hygienic convenience and keeping a safe distance. As a result, crowded stores will not be an attractive sight since crowds should be avoided in general. To give shoppers more personal space, stores will need to consider controlling their premises closer, for example limit the number of shoppers that are in the store at any given time. Stores across the USA already started implementing limiting total number of customers allowed in the store at one time and are also taking additional measures such as making aisles one way to facilitate keeping a safe distance, for example as Lunds & Byerlys recently announced. Providing shoppers with such hygienic conveniences as hand sanitizer, disposable face masks and gloves, and keeping the store and merchandise absolutely clean after contact with a shopper, are a must.
Shopping by appointment is also a good solution to avoid overcrowded stores and people waiting their turn to get into the store: the customer arranges an appointment with the store in advance and is attended individually when in the store by store staff to assist with any questions or to provide recommendations and advice. From the advance appointment store staff has the time and opportunity to prepare for the customer’s visit, understand what they would like to see and purchase, arrange availability and alternative options for the products sought and also prearrange the presentation of complementary products and services the customer may choose to purchase. A variation on prearranged shopping is subscription based shopping which is a topic we have explored in our blog article on Community in building brands, written by our senior consultant Zoltan Juhasz.
Curbside pickup is something that is also growing quickly as an option to pick up purchased goods, especially in the USA. Kirkland’s has just gone live with such option at many of its locations among other retailers. Customers can order on line or browse in the store and instead of collecting the items themselves, those are packaged and made available for pickup directly from customers’ vehicles on the curbside of the store itself. This way customers can chose to go inside the store or shop online, yet have the convenience of immediately getting products they have purchased while they are out of their homes and in their vehicle.
Whatever strategies retailers choose to implement, communication is the most important action that they need to take. To retain consumer communities during and after a pandemic crisis, retailers must communicate frequently and in detail on social media about the actions they take to mitigate impact of the corona virus. We strongly believe in the importance of showing social sensitivity to express humanity and show your care for partners and customers. This is the time to develop a circle of trusted customers. Engage on social channels, build communities and involve the followers of your brand in your conversation!
In every change there is opportunity. Our teams have been working with retailers for over two decades and have been working on detailed scenarios for a post COVID-19 retail best practice based on experience and feedback from our global ecosystem. If you would like to learn more about our recommendations or discuss this subject in more detail, have comments, feedback, or additional thoughts, please do not hesitate to reach out to my team and me on our company website! LinkedIn messaging works best!