How To Survive in the Post-Pandemic Retail Economy

The good news is that the post-pandemic retail economy doesn’t seem to require another pivot. When the pandemic descended on the world, forcing global closures, the retail industry took a big hit. However, online brands weathered the storm a bit better, and those without an online presence had to build one or perish quickly.

In our article, “Moving Past 2020: 7 Tips for Small Business Success in 2021,” we highlighted some of the strategies small businesses employed to survive the pandemic. Now, as we move out into a post-pandemic world, customers are ready to return to their favorite shops and venues.

What does this mean for you?

Omnichannel Marketing

By all indicators, many of the pandemic-induced changes in consumer behavior are permanent. For instance, you still need an online presence. But, at the same time, if you have a physical store, you’ll need to create an inviting, safe, and customer-friendly environment there. In other words, you’ll need to be omnichannel to stay competitive in the post-pandemic retail economy.

An omnichannel approach means creating more channels and conveniences for consumers to purchase, improving their overall shopping experience. For instance, if you want to drive traffic to your physical store, you might offer options to buy products online and then pick them up at your store. For those who prefer to buy from your online store, you might want to improve your shipping capabilities and return policies to keep your consumers happy.

post-pandemic retail economy

 

The Pandemic’s Impact on E-Commerce

Online Shopping Hits Global Records

According to United Nations statistics, global e-commerce hit $26.7 trillion in 2020, increasing 19%. This boost in digital sales impacted both B2B and B2C brands, although B2C companies experienced the most significant gains.

During the first quarter of 2020, American department store sales dropped by 25%, growing to 75% in the second quarter. (IBM US Retail Index) However, online sales reached $791.70 billion in 2020, an increase of 32.4% from 2019. (US Department of Commerce). Millions of consumers began buying groceries online, forever changing the face of the grocery industry.

Brand Loyalty Takes a Back Seat

The pandemic led to a significant decline in brand loyalty. With the increase in online shopping, the doors were opened to global brands. As a result, choices became less about brand loyalty and more about value, price, and convenience. A July 2020 Ketchum survey found that 45% of consumers had changed their brand preferences. McKinsey published a research report a month later saying that the drop in brand loyalty had increased to 75%.

In some cases, the shifts were because stores didn’t have their favorite products in stock, so they went to a different retailer. But a more significant factor was whether or not the brand had an online presence.

If you had an online store and a physical store, you might have noticed less of a drop in consumer loyalty. But, of course, this assumes you could keep your customers’ favorite items in stock.

Suppose you were a physical fitness coach and immediately shifted to online classes. In that case, you might have kept most of your students. But, if you were in the gym only, you probably lost them to a competitor.

The Ketchum study found that 62% of consumers who switched brand preferences intend to make that change permanent.

The Post-Pandemic Retail Economy

Your Consumers Want to Go Out AND Shop Online

An OMD and Omnicom Commerce Group research survey conducted in the US, UK, China, Australia, Spain, and Germany revealed some interesting pandemic and post-pandemic consumer behaviors.

Consumers still prefer the physical retail shopping experience. However, of those surveyed, 26% reported that they want contactless and cashless options before returning to physical retail venues.

Click-and-collect (shop online and pick up at the curb) appears to be holding post-pandemic. In addition to safety issues, consumers also found the click-and-collect reality to be very convenient, especially for parents and busy professionals.

Almost half of the respondents reported that they prefer an equal mix of online and in-store buying. They’ll be looking for the convenience of 24/7 online shopping combined with a seamless shopping experience.

Create a powerful omnichannel strategy to track your consumer’s buying journey. Then accommodate their preferences to create a unified shopping experience at every touchpoint in their journey.

Consumers Changed the Way They Pay for Goods and Services

PayPal and BigCommerce report that consumers have also changed the way they pay for products and services. There has been a significant increase in consumers who use digital wallets to pay for products online and in-store. According to research, 70% of consumers report that they’re likely to spend more at a retailer that offers the broadest menu of payment options.

Adopting an omnichannel approach will help you reach your consumers on all the platforms where they are likely to spend their money and buy your products or services.

Buy Now, Pay Later

The economic impact of the pandemic was felt across all sectors, consumers and businesses alike. As a result, customers had to delay purchases, which was disappointing for them and devasting to brands’ bottom line. The solution was to expand the “buy now, pay later concept,” allowing customers to purchase big-ticket items in installment payments.

By all accounts, buy now, pay later doesn’t seem to be disappearing. According to an Adobe Digital Economy Index: COVID-19 Report, there was a 215% increase during January and February 2021. And, even though the pandemic appears to be waning in some places, the economy is still uncertain. Moreover, it is likely to remain so for the rest of 2022.

Offering a buy now, pay later option on your more expensive products and services will help you remain competitive in the post-pandemic retail economy.

Preference for Purpose-Driven Brands

Consumers were already voicing their preference for purpose-driven brands even before the pandemic. This preference extends to all B2C and B2B brands and even to investment choices.

If you want to be competitive in the post-pandemic retail economy, you’ll need to optimize your brand message to let your consumer audience know your values and purpose.

The Edelman Trust Barometer report that we cited in a previous article states that 80% of American consumers are looking for brands that solve societal problems, as well as their own problems.

And, 86% say that authenticity is key to choosing which brands to like and support.

“It’s essential for brands to stand for something else than profits.” Javier Quinones, President and chief sustainability officer of Ikea, US.

Use your website, emails, newsletters, and social media channels to let your consumer audience know

  • what causes you support,
  • how you’re giving back to your community,
  • and how your product or service is helping to improve the world.

For example, you can demonstrate that you care about the environment by using sustainable packaging.

If you’re a counselor, you can share stories of how your clients have grown to become influencers in their communities and workplaces. Likewise, if you’re a business coach, you can use consumer-generated stories to share how your coaching helped them take their companies to new heights.

Clothing brands can use storytelling to share how their garments are made, focusing on sustainable materials and sensitivity to working conditions.

And What About Post-Pandemic Retail Marketing?

There are many unanswered questions, but one thing is sure—your marketing strategies need to be fluid. With lingering economic uncertainties, rapidly shifting consumer behavior, pivoting business models, and fluctuating markets, you need marketing strategies capable of capturing an ecosystem in constant motion.

  1. If you didn’t optimize your online presence, now is the time to do it.
  2. Align your brand values and messages with consumer demands for sustainability and purpose.
  3. Sustain confidence in your brand with authentic and transparent messaging across all your digital channels.
  4. Consumers have thrown away boundaries, and you need to do it too. 
  5. Omnichannel means creating a seamless, integrated journey for your consumers wherever they are.

Online Communities

Consumers worldwide joined online communities to connect, share information and find distractions during an unprecedented time of shutdowns and isolation. Online communities are not going away in the post-pandemic retail economy. In fact, they will assume a more prominent role in consumer purchasing decisions.

Build an online community around your brand and be active in relevant groups to increase your brand visibility and authenticity.

As physical stores reopen, you’ll want to capture the increasing foot traffic.

  1. Create experiential and fun events for your consumer audience.
  2. Host simultaneous in-store and online events, and be sure to use the latest high-tech tools so that the online audience can share fully in the event.
  3. Use Google My Business and other location-specific platforms to let potential customers know you’re open, what you offer, and what you’ve done to create a safe and healthy shopping experience.

Bottom Line

As we’ve seen, consumer behavior evolved during the pandemic, and we can expect more shifts in the post-pandemic world.  Yet, at the same many of the changes in consumer shopping behavior will not change. Therefore, the most critical factor in surviving the post-pandemic retail economy is keeping your marketing strategies as fluid as possible.

  • Learn everything possible about your consumers and target audience.
  • Show up where they are.
  • Create multi-channel, seamless shopping experiences.
  • Be authentic and purpose-driven.

 

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