How the Retail Industry is Transforming due to COVID-19

By: Retail CIO Outlook | Thursday, July 30, 2020

Fremont, CA: The COVID-19 pandemic has changed life as we know it. Even after normalcy is restored, things might never be the same again. The spread of the disease has impacted businesses across all sectors, and business leaders are rapidly adopting new methods to stay abreast. The impact of the virus has been beyond measure, with most companies laying off the workforce's vast chunks. The only thing certain here is the longer this crisis continues, the more significant the impact on retailers of all sizes.

Financial leaders from consumer markets believe it may take at least six to twelve months for businesses to return to normal, while others think it could take years. It is clear that the COVID-19 pandemic has set out a new normal that retailers and consumers need to accept. In fact, the virus has been a catalyst in the shifting of consumer preferences and business models. Consumers are increasingly using social media for purchasing and consorting to online shopping in unprecedented numbers. Moreover, consumers are now seeking purpose in all their purchases. In response, retailers are exploring alternative delivery methods and implementing digital touchpoints across the shopping experience. In many ways, the COVID-19 pandemic has brought forth the future of retail, sooner than expected.

Consumer market leaders are now faced with a challenging task of short term financial decisions concerning cost containment and liquidity. While promotions are very likely this year, industries will also experience permanent store closures and bankruptcies. In addition, as companies continue to encompass new methods to grow their business in a post COVID world, new challenges and competitions will also rise. The more significant challenge lies in devising the right strategy for the holiday season when the sales are at the peak. The coronavirus has definitely created an awareness of social distancing, which is very likely to be carried forward once the spread of the disease is under control.

Layoffs and closures can never be good news, but they offer organizations a chance to rethink their strategies. Companies can assess different areas of business and identify those that need strengthening, such as marketing strategies, supply chain diversification, and planning for the moment stores do open. The times are dark, and companies cannot afford to dwell on these decisions. Executives need to step up and make drastic changes to their organization, policy, and strategies if they wish to stay in business post-COVID.

With lockdowns and social distancing restrictions in place, the retail industry has seen a massive shift from in-store purchases to home delivery services. This is not just an opportunity for big retailers, but also delivery agencies. The rise in demand for home deliveries has given rise to various alternative delivery methods scaled to regional or small local businesses. Smaller retailers play a significant role in the economy, and this is an opportunity for them to step up and accept online orders. The addition of social media platforms like Instagram and Facebook can help businesses without a substantial ecommerce presence.

There has been a significant rise in the amount of time spent online by consumers. This rise offers brands a chance to engage with new potential customers. This is the time for brands to step up and establish their identity. Effective storytelling techniques can help brands retain their customers even when they are open to trying out new ones. The surge in virtual hours and live videos is an indication of consumers' craving for human contact. Brands can help meet that need by showing their human side and the people surrounding the business. There has definitely been a rise in kindness and empathy all around the globe. It will be no surprise if consumers come out of this pandemic expecting more from their preferred brands. This means brands need to step up their game and come up with new strategies that will blow the customers' minds away.