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Retail in the Age of COVID

The COVID-19 pandemic has changed the world - and it will never be the same. 

We’ve already seen the virus shut down travel, close borders, impose lockdowns and curfews and result in 648,913 deaths (as of July 27, 2020). It has spread to every country in the world and has disrupted life for just about every human being on the planet. 

However, as reported in this recent Economic article, even in the countries that have had the worst outbreaks  only 5-15% of people have been infected.  This might mean that they are immune to future infections, but most of the population is still susceptible. 

This means that, at the time being, getting back to life as usual is impossible. Although lockdown will not last forever, it will persist for quite some time. 

The best way to resume life as normal is to develop a vaccine. However, even the most optimistic predictions say that it will be January 2020 before a vaccine becomes widely available. In the meantime, we will need to adjust to coping with COVID-19 in the long term. 

The COVID-19 pandemic has affected every aspect of daily life - and retail is no exception. The longer the pandemic goes on, the greater the impact it will have on retailers of all shapes and sizes. The shopping experience as we know it has been irreparably changed. 

There’s no way we can go back to “normal” - we will have to adjust to a new normal. 

How Has The COVID-19 Pandemic Changed Retail?

Over the last several months as the pandemic has taken hold around the world, COVID-19 has already drastically changed the world of retail. 

When countries around the world went into lockdown measures of varying severity, many retail outlets had to shut completely. In many locations, only essential businesses such as supermarkets and pharmacies were allowed to stay open. As restrictions have shifted and other retail shops start to open up again, we’ve seen many changes in the typical shopping experience. 

For example, there was already a growing trend towards online shopping, but the pandemic only accelerated it. Online-shopping naturally took over during a time where we needed to socially distance from each other as much as possible. In some situations, such as households with immuno-compromised members, families were completely quarantined and avoided all contact with others. This made online shopping and delivery essential for all purchases, from pharmaceuticals to food and more. 

Retail in the age of Covid-19 - Grocery Shopping Delivery | Accept UK

However, even as the social-distancing regulations ease, the trend towards online retail is predicted to continue. Shopping online is likely to become the new norm. This change will mark a significant re-design in the way the retail industry functions in the future. 

Mobile and cashless payments are becoming even more prevalent. Even many brick and mortar retailers are switching over to cashless transactions, as this means that they don’t have to handle cash. Restaurants and other eateries are focusing on take-out and delivery orders far more, even in locations where premises are open and customers are allowed to dine. 

Most stores have announced new Health and Hygiene Guidelines for their retail premises. Each brand will have their own unique plan for ensuring the health of their customers and staff, but these guidelines will usually include mandatory face coverings, increased store cleanings, temperature checks and hand sanitizers. Also, some stores may limit the amount of people allowed in at any given time, in order to encourage social distancing. 

Also, safety equipment is becoming commonplace in almost every store. From plexiglass shields to gloves to masks to antiseptic wipes to social-distancing floor markers, these protective measures have become a normal part of the shopping experience.

Retail in the age of Covid-19 Employee behind Protective Screen | Accept UK

These types of equipment are important, as they not only prevent the spread of disease but they also let customers know that the retailer is taking COVID-19 seriously and looking out for their health. 

Another way the pandemic has affected retail is simply that people have less disposable income. Many consumers have lost their jobs or seen a dip in income due to the pandemic. Since people have less disposable income, discount chains and great value sales have become even more popular. The average shopper has taken a financial hit, so they will be more value conscious.  

The retailers who have thrived the most have been the ones who are the most adaptable. Customers have chosen to support the retailers who care about their needs and understand how they want to shop. Stores that have adjusted, adapted and offered a pandemic shopping experience that is safe and convenient are the ones that will experience continued success. 

5 Ways Coronavirus Will Change the Way We Shop In the Future

Although coronavirus has already changed retail drastically, the changes won’t stop there. The virus will continue to change the way we shop in the future. The need to apply social distancing rules and protect customers will lead to even further changes. 

These are just a few of the trends and changes that are likely to continue: 

1. Mobile Payments Will Thrive

In the past, many retailers dealt mostly in cash. As COVID-19 changes the retail landscape, mobile payments will become the standard way of paying for goods. Smartphones and Apple Watches will become more popular as we want to avoid the germs of a credit card machine or handing over cash.

Star Micronics mPOP  mPOS Cash Drawer | Accept UKWe will be shifting from the traditional cash drawer to digital - a change that will require some adjustment. Retailers who previously only dealt in cash will have to factor in transaction fees and commissions into their profits. They will also need to worry about digital payment fraud. Also, all their transactions will be digitally recorded. This is quite an adjustment and will have an impact on the bottom line. Businesses that can smoothly adjust to taking mobile payments will have a competitive advantage. Those who invest in mobile payment systems that help these payments go smoothly will come out ahead of the crowd. 

This switch to mobile payments will have a major impact all over the world - especially in countries that traditionally had a cash economy. In many developing countries, large portions of the population don’t even have bank accounts and conduct nearly all of their financial interactions in cash. 

We are likely to see a rise in mobile money services reaching these markets - especially innovative apps that allow for mobile money purchases without bank accounts. In addition, we’ve already seen several countries reduce the barriers for private transactions by lowering fees and raising daily limits. The prevalence of digital payments will have an impact everywhere, from major cities to the smallest rural locations. 

2. In-Store Samples May Become a Thing of the Past

Another one of the main changes that will happen in the retail environment is we will see in-store samples start to disappear. Although Costco has recently announced it will be offering food samples again, this move has been met with skepticism from epidemiologists who believe it increases the risk of a new wave of infection. 

Offering samples used to be a common strategy for retailers to get customers interested in new products. Make-up, perfume and lotion displays would often have “testers” and supermarket staff would hand out small bite-sized portions of products the store wanted to promote. 

However, thanks to the COVID-19 pandemic, it’s likely that the entire culture of in-store samples will have to change. Customers will likely be much more hesitant to try something that other shoppers may have touched or breathed on. 

If stores want to offer samples, they will need to do it in a way that is pandemic friendly. For example, we might see more stores handing out individually sealed and packaged samples, or offering small sachet testers of lotion or makeup rather than a “tester” bottle. 

In-store makeup testers have always been breeding grounds for spreading disease. According to a 2019 study, 70% of all lipstick, lip gloss, mascaras and eyeliners tested had significant levels of microbial contamination. Naturally, the moist environment of liquids and creams creates the perfect home for microorganisms, which are then spread into the skin, lips and eyes. 

The COVID-19 pandemic was the final push toward getting rid of disease-spreading samples forever. When shopping for make-up, customers will need to practice the art of matching their foundation to their skin tone just by looking at it. 

For example, according to Insider beauty chains like Sephora and Ulta have already announced that they are eliminating tester products and showing makeup for display only. Bluemercury says that they will give their customers individually-wrapped, vacuum-sealed samples. 

Unfortunately, although these individually-packaged samples will be great for customer health, they are a step backward for sustainability. These plastics will usually end up in the landfills, lakes and rivers, where they will break down into microplastic particles for eternity. These particles infiltrate the soil, air and water and are consumed by humans and marine life. 

(A better strategy will be for companies to use glass containers for their samples, which are much more recyclable.)

3. Order for Pickup Will Continue to Thrive

An additional trend that will continue is the demand for “order for pick-up” arrangements at retail locations. According to Adobe Analytics, the number of orders placed online and picked up at stores increased dramatically by 208% between April 1st and April 20th 2020, compared with the previous year. 

Ordering online to pick up in store has the best of both worlds. It’s convenient and saves time, but customers don’t have to wait a long time for delivery. It also removes the need for customers to enter the store, helping to reduce the spread of the disease.

Many customers were forced to use online ordering for pick-up as it was the only option available while sheltering in place. However, they may have come to enjoy the convenience of being able to select all their purchases via an app and simply pick them up without having to wander around the store. 

It’s likely that many retailers will adjust to becoming mainly pick-up centers. This will change the way retailers market their products. Without relying as much on store displays and sales staff, they will need to shift most of their focus into online marketing. 

Some retailers will start to experiment with new ways to serve their online customers. This includes large grocers like Tesco, Sainsbury's and Lidl looking at using technology to fulfil customer orders. Some brands have even been opening up “dark stores” - which are warehouse locations that look like supermarkets but only serve to deliver groceries and prepare pickup orders. These “micro-fulfillment centers” may even use robots to collect everything on the customer’s shopping list, which will speed up the shopping process. 

However, this doesn’t mean that all retail shops will only operate for online ordering and pick-up. Many shoppers still desire the ability to touch their produce or try on clothes before buying them. There is certainly something to be said for browsing aimlessly and getting inspiration from retail displays. 

4. Department Stores May Go Obsolete

In decades past, nearly every mall had at least one large department store that served as an anchor - such as Debenhams, House of Fraser and Bennetts. These large stores sold clothing, home goods, cooking ware, toys, make-up, perfume and other products. 

However, the department store has already been in decline over the last several decades and many of these businesses are filing for bankruptcy. It is likely that the coronavirus epidemic has sped up the demise of the department store and will soon make it extinct. After all, malls and department stores will not be desirable places to shop even after the pandemic, as consumers will still be wary of visiting public places. 

Department stores were already on the decline, due to a lack of interest from millennial and generation Z customers. After all, department stores relied heavily on customers leisurely browsing - flipping through racks of clothes, perusing make-up and perfume counters and looking through displays. For several months, shoppers have been making fewer trips to the store and only purchasing essentials. 

Shoppers from the younger generation aren’t naturally drawn to the department store, choosing instead to shop online and purchase exactly what they want. 

5. Independent Retailers Will Struggle

Independent retailers were already struggling, as the high street was challenged by Amazon and other online retail behemoths. Since COVID-19 struck, they are under an even greater threat. 

Mom and Pop shops that didn’t have enough money in reserve to last through the entire lockdown may have to shut down, leaving shopping streets filled with the large chain corporations. Unfortunately, this will create a more homogenous and less character-filled shopping experience. 

However, this does not mean the end of independent retailers. Consumers still have a desire to shop with local retailers who are offering unique products and will choose them over the large brands. 

SpacePole Hand Sanitiser Bottle | Accept UKThe key will be for the independent retailers to pay attention to how they can serve their customers with as much care and consideration as possible. This includes investing in the right protective equipment, so that they can keep everyone safe and healthy. 

For example, small independent stores that have protection screens, cashless payment terminals, sanitisation stations and other equipment will be showing customers that even though they are small, they are taking the pandemic seriously and protecting the health of their customers. 

Customers Will Remember How Brands Made Them Feel 

When it comes down to it, it’s the brands who are open to adapting and learning that will thrive throughout the difficult challenges of COVID-19. This pandemic has tested the innovation and ingenuity of many brands. 

Customers are looking for retailers who understand what’s going on and they want to support those who care about their safety. They will remember how brands made them feel in this time of uncertainty - and they will reward it with their wallets.