BOSTON—The COVID-19 pandemic will have a long-term impact on the retail sector, disrupting consumer shopping behaviors through 2025, according to a new report from Edge by Ascential.
The report, “Future of Retail Disruption,” highlights factors that will disrupt long-established structures and practices within the retail sector, and Edge by Ascential analysts recommend ways retailers can address those changes. They include:
- The shift to online and increase in convenience—This shift to online purchases will impact in-store shopping behaviors, as convenience and proximity become important factors in determining where to shop. Retailers must support this transition to omnichannel shopping with flexible, transparent and reliable supply chains. Retailers may prefer to focus on bringing in-store experiences online and place less reliance on big-box formats.
- Increased demand for health trends—Existing consumer trends around wellness and healthy lifestyles have been further buoyed by COVID-19 and will prompt retailers and brands to focus on “good-for-you” offerings from in-store health services to educational and inspirational initiatives. Brands should also innovate around on-demand health and hygiene benefits and clearly communicate to consumers in order to differentiate themselves from competitors.
- New in-store expectations led by technology—The coronavirus has made consumers more concerned about in-store and product safety. Retailers should explore ways to drive excitement and inspiration in-store through innovative merchandising solutions and the increased use of digital touchpoints. Providing credible information on the origin and production standard of products will be key for brands seeking to maintain a strong on-shelf presence.
The COVID-19 pandemic is having a seismic shift on retailing, and the effects are likely to be permanent, said Xian Wang, global content director, Edge by Ascential.
“We have seen a dramatic shift toward digital commerce, with 40% of global retail sales projected to come from e-commerce by 2024,” Wang said. “To adapt in this new environment retailers need to proactively define their own market position and focus on the priorities of consumers, such as what they are placing more value in and their biggest concerns, which can vary by market."
Already, some retailers are adapting their strategies and expanding their offerings to achieve greater loyalty. This includes engaging customers through a more holistic offering, such as health-care services, entertainment hubs and convenience fulfilment.
“This will be key in helping retailers remain relevant in these rapidly developing times,” Wang said.
For brands, the focus must be on global flexibility and rapid product delivery. “Fast-paced and agile manufacturers will dominate trading,” she said. “Brands that master flexibility and can operate across multiple digital platforms and touchpoints will benefit greatly and will be the ones that ultimately stay top of mind with shoppers."
To access the full report, email firstname.lastname@example.org.
NACS has compiled resources to help the convenience retail community navigate the COVID-19 crisis. For news updates and guidance, visit our coronavirus resources page.