The Physical Retail Experience is Not Dying – It’s Becoming Smarter, Stronger, and More Modern

June 30, 20207min

Some 66 million years ago, a great disaster (likely a meteor or asteroid) struck the Earth. For the grand, unagile dinosaurs that had dominated the planet, changing little for millions of years, it proved fateful. But in their place mammalian life blossomed, giving rise to primates, modern birds, canids, horses, and countless more species.

In the world of physical retail, the lockdown of 2020 may prove a similarly significant upheaval: many dinosaurs of retail will struggle unless they adapt; and we will see new, sharper businesses, better tied to ecommerce experiences, spring anew. So, while its economic impact is of course undoubtedly bleak, we should also recognise the renewal that the pandemic will bring to the retail landscape.

In recent years, the British press has repeatedly forecast the ‘death of the high street’, with several incumbent retailers already closing their doors, or resorting to bailouts and mergers before the pandemic hit. With COVID-19 ongoing, the death of the high street seems even more imminent. But rather than triggering the final, complete desertion of the high street, I would argue that the pandemic will rather call for the reinvention of the retail experience, reshaping the physical high street model and relaunching a shopping experience based on consumer habits.

Throughout the pandemic, many retailers have already proven their resilience, innovatively finding new ways to appeal to and reach the consumer.

Although businesses will struggle, and some will unfortunately be at the brunt of those most affected, the unprecedented impact of the pandemic will also give rise to many others. With these new businesses, will come fresh new ideas about how retailers interact with their customer bases, built upon the changing expectations of the consumer.

Consumerism has become an essential part of modern life, with retail accounting for one-third of British spending. What COVID-19 will bring is a more targeted approach to retail, and with that perhaps an end (or at least a significant pause) to excessive consumption. Retailers will have to focus on consumer behaviour, making the experience as seamless as possible from start to finish, regardless of where the customer journey takes place. We can expect consumer trends to change and new standards to arise, with the customer experience being an integral part of this transformed shopping experience. Perhaps this will add to the emerging trend of shopping locally and supporting smaller businesses that have a greater investment in the communities they serve.

Photo credit: HappyOrNot

As shoppers have been encouraged to stay at home, physical sales have plummeted to a halt. Some retailers have already started to change their methods of engagement, innovatively adapting their businesses to navigate their way through the pandemic. All retailers who are able have taken to online sales. With little other option, avid shoppers of all ages are surfing websites rather than hitting the high street. Even before the crisis, online shopping has been a growing trend. Over the past ten years, online sales have increased by 324 percent. With dedicated websites such as Shopify already rising to prominence, ecommerce will be a huge focus during the reinvention of retail that will come in the months and years ahead, with bricks-and-mortar businesses of all stripes being reshaped to support this as the main avenue of revenue, and interaction with a customer base.

With rentals for retail spaces coming at a huge operational cost uncertain, the future of the department store landscape will be an interesting area to watch, and big retailers will need to keep adapting. Shoppers will still feel more comfortable being able to make high-value purchases in person and trying before they buy.

But ecommerce platforms are seizing the initiative to combat this through incentives like free delivery. So the onus is on retailers to synchronise their offline and online offerings, to draw customers back once lockdown is lifted, and continue to justify the costs of floorspace.

With remote working inevitably becoming the norm for a significant portion of the workforce, impulse buying, food-to-go, and consumption behaviours are all expected to change beyond recognition, according to the Retailer Group.

The fashion industry too will face a greater immediate challenge, as the idea of ‘try before you buy’ could be forever changed in order to follow social distancing guidelines. While this may lead to innovations such as virtual fitting rooms, it could also change attitudes to shopping, and return policies. And more broadly, working from home creates greater flexibility for the consumer, and a growing demand for delivery options from retailers will accommodate this changing lifestyle. Remote working will revolutionise the whole retail ecosystem: at every step, from production, to logistics, to a dramatic increase of need for digitally skilled employees.

COVID-19 is a huge and unprecedented challenge for retail, it is true. But it may also herald an era of evolution, inspiration, and opportunity like none we have ever seen, where the dinosaurs of retail give way to new and thriving forms of business.

Ville Levaniemi

Ville Levaniemi

Ville Levaniemi is Executive Vice President and Co-Founder of HappyOrNot.

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