If you’re like us, you were probably very surprised recently when reporting began on the one-year anniversary of the first COVID-19 lockdowns. We found ourselves stuck somewhere between “How can it really be one year?” and “It feels like five years!” Either way, most of us can agree it’s been a trying time which we hope will end soon.
Given the one-year anniversary of the pandemic, we thought it would be a good time to reflect on the big changes to the retail landscape this past year and look at what the experts predict will happen once the pandemic is over.
No question, the retail landscape has changed
Some retailers have already filed for bankruptcy, laid off employees, or are in the process of liquidating stores. Others, such as home goods stores, fitness, and activewear brands have benefited as consumers fixed up their homes, looked for ways to stay healthy, and adapted their wardrobes to the work-from-home lifestyle.
Some industries won, some lost. According to Statista, as the pandemic raged last summer revenue was up in the grocery industry (+18%) and the household supplies industry (+3%), and down heavily in the skincare and cosmetics industry (-24%) and general apparel industry (-35%), just to name a few.
Where things were: Early pandemic retail predictions
Toward the start of the pandemic last April, we looked at initial impact of the pandemic on the retail landscape. We noted five early retail trends that had already emerged and predicted that they would stick around after the pandemic. (Of course, we had no way of knowing that one year later COVID-19 would still be playing such a major role in our lives.) These trends were:
- The prioritization of employee and customer safety
- Customers will need a reason to shop in-store
- BOPIS (buy online, pick up in store) will remain a necessity
- Reliance on wholesale will be reduced, and direct-to-consumer will reign supreme
- Store associates will need to create an omnichannel experience
How did our predictions stack up against what retail analysts and experts are saying to expect in the sector going forward?
Where things are: Experts predict these trends will stick around post-COVID
The big research and industry consulting companies have surveyed and analyzed trends over the last year and have weighed in at the one-year mark with predictions for what retail will look like at the end of the pandemic. Here’s what we know now and the five retail trends they say are here to stay.
1. Touch-free shopping. No more swiping a credit card: many retailers are trying to make it easier for consumers to avoid shared surfaces and limit interactions with employees or other customers, so they’ve invested in contactless checkout approaches, such as NFC ‘taps’ and smartphone apps. There’s no going back; this trend is here to stay.
2. Continued rise of online shopping. No surprise here. The convenience of online shopping has won over even the hold-outs who preferred in-store shopping: consumers spent $861 billion online with U.S. retailers in 2020, up 44% from 2019, according to Digital Commerce 360. Put another way, online spending represented 21% of total retail sales in 2020, compared with 16% the prior year. This also includes buy online, pick up curbside shoppers. 68% of consumers in a recent GlobalData survey said they are going to continue to use curbside pickup at stores in the future.
There may be an unfortunate repercussion of the transition to e-commerce, however: it may hasten the decline of shopping malls. Coresight Research forecasts that 25% of malls in the U.S. will close over the next three to five years, possibly continuing the 'Retail Apocalypse' of the last five-plus years.
3. Virtual reality shopping tools. Related to the rise of e-commerce are virtual shopping tools that help customers “try on” or picture how a product will look on them, even from great distances. For example, retailers are using videos to show how a handbag, or a pair of glasses will look on a customer. Other retailers are offering virtual beauty advisers, skin-care diagnostic tools, and live stream shopping, or allowing shoppers to make virtual appointments with sales associates and stylists.
4. Social media shopping. Customers who want to shop within a community or look to social influencers to help them decide what products to buy are turning to Instagram, Facebook, and TikTok in much greater numbers. More than one in three shoppers made a purchase directly from a social media platform in 2020 according to a survey by Bazaarvoice. Another survey from Influence Central found that 69% of consumers said they currently purchase directly via Facebook posts; 34% said they click Instagram’s shoppable links; and 33% use swipe-up links to buy. Experts predict these numbers will rise further in 2021.
5. Work-from-home continues and may foretell the rise of some retail categories. Experts say that companies have realized the benefits of remote work, and research from PwC found that the majority of office workers now say they want to keep working remotely at least two days a week. But how does this impact the retail space?
Consumers have gotten used to dressing comfortably in casual clothes, which bodes well for athleisure and other “Zoom-ready” styles, and not so well for dressier office wear, for example. Prepared meal delivery has surged during the pandemic, especially healthy meals: an Accenture study found that 60% of consumers say they are seeking healthy foods more frequently than they did before the pandemic. And finally, goods and services to make our homes more comfortable are also on the rise. Home remodels increased 20% in 2020 over the prior year and visits to online home furnishings brands were up 26%, according to Comscore.
The pandemic has made customer data more valuable than ever
These trends have implications for retail marketers. The pandemic has changed the retail landscape permanently, and companies that remain stagnant instead of adapting to changing consumer expectations in real-time will be faced with real challenges in the months and years ahead, which is why customer data management (collection, analysis, and action) will be critical. Retail’s next life stage is here, and it calls for highly effective customer data management to provide retail marketers with the actionable insights needed to respond to customer demands and engage with them where they want, when they want, and with the relevant offers and experiences they want.
At our core, QuickPivot is a company whose mission is to help you take control of your customer data and use it to carry out the data-driven, cross-channel marketing campaigns that today's evolving retail landscape requires. As such, we would be remiss if we didn’t mention that to best adapt to changing consumer demands and build campaigns that meaningfully connect with them, you need a customer data platform like QuickPivot to get that done. In a world where data is quickly becoming your most valuable asset, a CDP is what your organization needs to take its marketing campaigns to the next level.
So if you or your team is struggling with customer data management and unification, reach out today to learn how the QuickPivot CDP can help get your data working or you.
