In the midst of the pandemic, retail businesses have shown to be particularly vulnerable to the ripple effects. Staff shortages, supply chain disruptions, and mass closures are just a handful of challenges they have faced so far in 2020- challenges that have pushed many of them to the brink of administration. As of Tuesday, October 27, the economy was operating at 82 percent of its normal levels since March. Yet opening hours for retail businesses are less, health and safety regulations have been increased and, consumer spending confidence is at an all-time low. Now, with the peak holiday season fast approaching and no signs pointing to a retail recovery in the American economy just yet, retail businesses are left wondering what is in store for their business? Is Black Friday shopping over for good? How can retail businesses bounce back from the impacts of the Covid-19 pandemic?
Consumer Confidence Drops For In-Store Shopping Drops And Rises For Online Shopping
Although most of the country has slowly resumed normal activity, consumer confidence remains lows when it comes to in-store shopping. In a survey by First Insight, only 33 percent of consumers felt safe in retail-oriented locations like malls. More specifically, 43 percent of them said they would feel secure shopping at small retailers. At the same time, retailers are trying to encourage consumer footfall in their stores as they try to recover after months of closures.
With such a difference in approach, it is clear that improving consumer confidence needs to be on the agenda for retail stores if they are to survive. The US Chamber of Commerce recommends retailers use a multi-pronged approach to communicating their dedication to keeping customers safe whilst shopping in-store. Retail businesses should be able to answer questions regarding adherence to the new health and safety regulations, social distancing measures being enforced and any disinfecting protocols to minimize contamination. Being transparent with regular cleaning and sanitization protocols like disinfecting frequent contact points every 2-4 hours, is aimed at improving both customer and employee confidence in being instore.
Retailers Being Forced To Plan For Long Term Disruption To Staff Rotas
With no viable long term vaccination on the market yet and cases continuously rising, the effects of Covid-19 is here to stay- and so are the effects on the retail workforce. Now, retailers also need to begin drafting long term contingency plans for labor shortages so that they can avoid store closures. For many, this can take the form of formulating temporary recruitment strategies and utilizing individual scenario planning for their retail stores. Retail managers will have to conduct regular scenario analysis to assess the conditions they are operating in and whether it is viable to keep the stores open.
For instance, in months where there is a severe floor staff shortage, store hours may need to be shortened or temporary recruitment agencies may need to be drafted to cover the gaps. Of course, with the use of temporary staff, there is also the need to account for adequate staff training on health and safety protocols including the use of PPE and store policies on store sanitization.
Digital Content And Omnichannel Communications Remain Key To Keeping Consumers Engaged
Another consequence of declining consumer confidence instore and rising staff shortages is the increased need for retailers to prioritize digital communication to consumers. During the lockdown period, eCommerce shopping increased 43 percent, and The Covid-19 and Ecommerce survey highlighted just how much the pandemic has shifted the perception of online shopping. Over 50 percent of respondents now shop online more often.
Because of the accelerated shift to digitalization, an omnichannel approach to sales is now paramount for retailers. A fully integrated customer experience between in-store, mobile, and eCommerce shopping provides the best chance for retailers to maximize customer acquisitions, loyalty, and survive in a time where consumer spending is declining. For instance, making in-store browsing and online returns possible or vice versa. Alternatively, retailers can correlate customer engagement activities between their online and brick and mortar locations such as marketing emails with in-store offers based on customer location and store proximity.
Finally, retailers need to think long term. Financially and operationally, it will be a long time before normality is fully returned to the world of retail. However, these steps will prove to be critical in the months ahead if retailers are to stand a chance of weathering this storm.