The tide was already beginning to turn.
People were spending less time physically searching through racks of clothes and spending more time clicking “checkout” from their couch. Or, in many cases, at least using their phones and laptops to inform their decisions before completing the purchase either online or in-store. Meanwhile, words like “personalized” and “convenient” were already becoming the go-to’s to describe consumer demands.
Then COVID-19 swept across the world, and what began as a slow tide turned into a riptide, forcing the retail industry to pivot in an instant. Searching through racks of clothes at a store wasn’t an option any longer. Convenience was the only option. And the list of words to describe consumer demands grew quite a bit longer.
The pandemic didn’t cause a 180-degree turn in the way people shop or what they look for in a retail experience. It accelerated the direction in which we were already headed and forced brands to keep up. The result is a transformation in retail that had been showing signs for a while but was brought about more abruptly than anyone could have imagined.
The question on the mind of every retailer now is, “how do we adapt?” Our latest DEG ebook not only dives into the factors surrounding this question but also aims to provide answers along the way. We’ll highlight a few of those here.
The forces driving retail
Take COVID-19 out of the equation. Retail brands were already faced with two major challenges. One was that consumer expectations were rising quickly, not just for a more cohesive experience overall, but for a more relevant, 1:1 experience as well.
But that is easier said than done, and many brands have been slow to keep up. A 2019 eMarketer survey found that 59% of companies still consider themselves “learners” in their ability to deliver personalized experiences in real-time across channels. That is why there is a noticeable gap between how brands perceive they are meeting customers’ needs for relevance and customers’ belief in how well brands understand them.
Data privacy is also a mounting concern that is becoming increasingly more and more regulated via legislation. GDPR got the ball rolling, but CCPA broadened the scope of what is considered personal data. It also, for the first time, allows individual consumers to ask companies what data had been collected on them, when the data was collected, and how it was used, as well as opt out of allowing the sale of their data.
Add back in the fact that the majority of consumers are isolated in their homes, and the necessity to understand what customers want and then deliver the right experiences is amplified even further.
Digital and in-store connectivity
One of the biggest takeaways from this pandemic is that people will come out of this knowing they can shop on their terms and purchase practically anything on their phones, and get it delivered to their homes. The idea of placing a grocery order while outside playing with your kids is no longer a luxury—it’s a normal activity.
Consumers will be looking for brands that make things easy and efficient for them. On the other hand, brands will need to try and figure out how to attach themselves to their customers’ routines and devices, since those routines are featuring brick-and-mortar stores less and less.
As brick-and-mortar locations start to once again become part of our lives, the in-store experience will be more important than ever. They will look and operate differently post-COVID in terms of safety and health measures, but stores will also need to integrate these digital innovations to maintain the convenience and benefits consumers have become used to having.
Two years of digital transformation
Microsoft CEO Satya Nadella put it well when he said, “We’ve seen two years’ worth of digital transformation in two months” in response to the COVID-19 pandemic. Digital-first shopping is here to stay, while the experience of in-store buying has shifted to be less about getting essential goods and more about the social aspects of shopping.
Learn how to navigate the future of retail
For more information about how to adapt your brand for the retail transformation that is continuing to evolve, download a free copy of our ebook, Strategies for Navigating the Future of Retail.