Five Ways Retailers Are Adapting In The Age of COVID-19
The most interesting changes we're hearing that companies are implementing to increase their presence in today's market.
The evolution of retail has been a game-changer for retailers, and the COVID-19 pandemic has had a significant impact on the industry. We speak to some of the planet's biggest and most innovative brands and retailers every day at Arrive, so we thought it would be beneficial to lay out five interesting trends we're hearing that companies are implementing to break through in today's market—because let's face it: "The Times They Are A-Changin'," and to win big means to adapt now.
1. Shifting From Physical Retail To Video Streaming
As COVID-19 continues to take the world by storm, retailers and brands are looking for new ways to keep their customers engaged. One way that they are doing this is by moving from physical retail locations to video streaming. This allows them to answer customer questions in real-time and provides a more personal experience for shoppers. Retailers and brands can also use video streaming to showcase their products and give customers a closer look at what they are buying. Video streaming is also a great way to connect with customers who may not be able to visit a physical retail location. AdWeek reports that 70 percent of consumers who “feel a connection to a brand” will typically spend twice as much as average customers. By using video streaming, retailers and brands can reach more people and keep them engaged with their products.
2. Developing A Sustainability Mindset
COVID-19 has caused consumers to seek out sustainable products and services, a significant shift in consumer behavior. Consumers want to know that they are making good purchases and that they are helping the environment. Coronavirus has opened people's eyes to where their products come from, how sustainable they really are, and what impact those things have on the world around them. Because of this, retailers are rethinking how they do business by looking for ways to reduce waste, recycle materials, and use renewable energy. Coronavirus promotes transparency and that is something that retailers can capitalize on. Being transparent about a company's sustainability efforts will also make customers more likely to trust them and buy from them. Retailers who are able to show they are taking the necessary steps to be sustainable will be more successful in the long run. The Arrive Platform is helping some of the world's most innovative brands execute on their sustainability strategy via resale and rental channels. Circular channels not only help brands become more sustainable, but they can increase revenue and attract and retain customers, as well.
3. Partnering With Other Companies
The New York Times published an article about COVID-19 Coronavirus named "Coronavirus Affects Retailers Marketing Efforts" stating that coronavirus is the main cause of the decline in marketing budgets for retailers and brands, with many cutting their advertising by more than 50%. Because of this, brands and retailers are doing less marketing on their own and more partnering with other companies. By leveraging brand audiences, partnerships, collaborations, and other co-marketing tactics help attract wider exposure and win more customers.
4. Optimizing Selection of Products
While Coronavirus will not cause people to stop shopping, many will look for new types of products to help them adapt to being more at home or face going outside. With this change in consumer needs, retailers are also adapting by expanding their product catalog to retain their customers and attract new ones. Some companies are offering products that are related to Coronavirus, such as face masks and disinfectants. However, many other companies are redirecting their focus from, for example, evening-wear to loungewear given the increase in staying at home. Coronavirus has also caused a rise in products such as convenience foods, home goods and personal care items.
5. Reevaluating Physical Footprint
COVID-19 is causing many retailers to reevaluate their physical retail locations. With in-person shopping becoming less and less popular, retailers are having to decide whether or not it's worth keeping their brick-and-mortar stores open. Some companies, like Macy's, have already begun closing down dozens of stores and many others are considering doing the same. A 2020 physical retail study by McKinsey & Company pointed out that retailers "can use four-wall profitability and cross-channel strategic importance to cluster stores by the potential actions: transform and grow, reopen as usual, reassess their role, and renegotiate leases or consider closure."