Navigating the Lasting Impact of COVID-19 on the Retail Industry

It’s been almost one year since COVID-19 went from a novel virus halfway around the world to one of the most destructive global pandemics in over 100 years. The retail industry has been severely impacted and faces near-constant demands to adapt to shifting realities. Retailers scramble to integrate safety protocols and meet product demand and shopping behavior changes, but there is a light at the end of the tunnel.

In fact, the unprecedented times may not have been so unprecedented for the retail industry, with a recent Deloitte article noting:

“If we’ve learned anything from previous recessions, it’s that they expose existing weaknesses, accelerate emerging trends, and force organizations to make structural changes faster than they had planned. This is particularly true in retail. During the great recession of 2008–2009, e-commerce grew, and brick-and-mortar retail declined. As the economic recovery took hold, that trend continued while off-price, discount, and emerging players succeeded by appealing to new consumer demands.”

One year into the pandemic and the proposed similarities between the Great Recession and the impact of COVID-19—e-commerce growth, brick-and-mortar decline, and acceleration of emerging trends—have proven to be accurate. It’s time for retailers to accept these changes and use these trends to strengthen their place in the market.

New Shopping Habits Will Stick Around

According to a recent report by Cotiviti, “a majority of retailers (53%) believe many of the consumer behaviors embraced during the pandemic represent permanent changes.”

Many consumer habits that were created or exacerbated by COVID-19 will continue after the pandemic ends. This is partly because many of those changes, such as the shift to digital shopping and rise of social commerce, were already in progress. Consumer’s new attitudes toward safety and spending habits are another contributing factor.

Here are a few of the high-level changes you can expect to remain past COVID-19:

  • Enhanced cleaning protocols
  • Contactless experiences (both in terms of delivery and in-store checkout)
  • Prioritized convenience
  • Increased support of local businesses
  • More mindful shopping
  • Economic concerns are top of mind

These new or intensified habits will directly impact how your retail business operates. To stay ahead of the curve, keep these changes in mind as you focus on the following critical areas in 2021.

Increased BOPIS Fulfillment

As the virus spread and contagion fears grew, retail traffic greatly slowed or stopped entirely in some regions.  This led to a rise in “buy online, pickup in store” (BOPIS) fulfillment. Where in-store shopping was available, new safety measures were implemented. A 2020 analysis by Kibo Commerce saw a 563% increase in BOPIS fulfillment options at the peak of the pandemic.

Underpenetrated categories, like grocery, saw exceptional acceleration, with BOPIS grocery sales in the U.S. at an estimated 4.3 billion in 2019 and 7.4 billion in 2020.

Recent survey data shows that this trend will continue. A Bizrate Insights survey of online shoppers in January 2021 found that the majority (57%) of shoppers said they would continue to use BOPIS options post-COVID-19. Of those respondents, 40% reported using BOPIS options “sometimes,” 26% said “whenever possible,” and 10% said, “once a week.”

Prioritize Omnichannel Customer Experiences

Issues with disrupted supply, operations, and fulfillment led to a surge in customer service needs, with some customer experience platforms reporting as much as a 69% increase in call volume from 2019 to 2020. If you have an immediate area of concern, dedicate resources there first, but with customer interactions shifting from in-person to online, a seamless experience on each channel.

Focus on the following elements of your customer’s experience:

  • Ask for feedback: With new features and operations, make sure to talk to your employees and customers to get their input on how things are going and how they can improve.
  • Act on feedback: Once you receive feedback, do something about it. If you ask customers or staff for their opinion but don’t act on it, you are telling them their opinion doesn’t matter.
  • Provide stellar customer service: Whether in-store, on the phone, via email, or in an online chat, make sure that your customer service representatives give each interaction equal time and effort. If associates cannot resolve an issue, instruct them to escalate to a manager for follow-up and resolution.
  • Retrain employees: Ensure staff is knowledgeable and adequately prepared to answer questions about products as well as new store policies. Training should include respectful ways to enforce new safety measures and help health-compromised customers. The new challenges with in-store shopping can cause stress on your employees, so it’s in the best interest of your team and your customers to focus on day-to-day operations.
  • Offer incentives: With consumers favoring convenient experiences and supporting local businesses over brand loyalty, make sure to stand out by incentivizing shopping with you. This could be a revamped loyalty program, shopping rewards, or partnering with like-minded brands to increase your appeal.

Have an Optimistic Outlook

“Nearly all retailers (97%) have a positive outlook in terms of macroeconomic conditions and growth over the next three years.”  – The Resilience of Retail

As you approach the next year with a renewed focus on meeting customer’s evolving habits, remember to remain flexible, offer safe and convenient experiences, and stay positive. To learn more about Synapse Group’s solutions and how we can help prepare your retail business for the future, contact us to speak with a representative today.

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