Retail’s changing landscape
14 September 2020
Retail has been one of the most acutely affected sectors during the COVID-19 pandemic, and there isn’t light at the end of the tunnel just yet. Therefore, the only option is to adapt and to do that as fast as possible.
One only has to take a walk through any local mall to see prominent brands closing down, small merchants struggling to survive and many empty shopfronts. As South Africa’s retail industry gradually starts to open up again, customers are returning slowly and cautiously.
Demand has become erratic as consumers flock to buy essential goods and largely stay away from other retail. As paying the bills becomes more of a challenge for many retailers, they have had to consider whether they could benefit from payment holidays or renegotiating rental agreements.
In trying to stabilise, retailers have to shift their focus:
- Crisis plan
Retailers must protect their employees as much as possible and ensure that they have plans in place for when infection hits. This could include hiring temporary staff or rotating the current workforce. Being compliant with all social distancing and hygiene requirements is essential.
- Cater to online demand
Retail focus has naturally shifted online during lockdown times and retailers need to ensure they have a robust online presence. This has to be supported by reliable delivery and logistics so that they can meet demand and drive revenue.
- Customer communication
Retailers need to constantly communicate with customers to build loyalty and show they understand the social and economic impact of the pandemic. Depending on their offering, this could include at-home consultations or value-adds, anything targeted at raising awareness and building support.
The future will look different:
The effects of the pandemic and the subsequent economic fallout has triggered changes in consumer behaviour, some of which will be long-term, and retailers need to recognise and react to these.
- Online presence
Consumers may never shop again like they did pre-COVID-19 and many who previously resisted it have now become comfortable with online shopping. Retailers will have to increase (or initiate) their online presence and prioritise this channel.
- Rethink shops
It’s already started happening in the UK, where shops are becoming more experiential and contact is less, making them more of a shop window while the point of sale happens online. SA retailers will have to follow this trend and will also have to be flexible and tech-savvy in terms of payment and delivery options.
- Personal touch
Communication will become more personal – to employees, customers and stakeholders – to increase loyalty and show empathy for the challenges we’re all experiencing. Customers will gravitate to brands that appear to support their values.
The ultimate challenge will be to get the mix right between online and bricks-and-mortar. Shoppers seem to be saying they like a little bit of both and retailers need to heed that request. Click-and-collect is one way of mixing it up – it gets customers online and then into stores, which has to be the best of both worlds.
Retail is a resilient industry and, with the right adaptations, is able to overcome the challenges of this pandemic. The focus needs to be on stabilising as soon as possible and then adapting to this new normal that is set to change the landscape forever.