Five Pandemic Lessons for Shoppers

How COVID-19 Is Accelerating Recent Trends in Retail

Oct 14, 2020

SMITH BRAIN TRUST  Lockdowns, high-profile bankruptcies, surplus stock spilling out of backrooms – the pandemic has rattled the already struggling retail sector.

From Pier 1 and J.C. Penney, to Brooks Brothers and Neiman Marcus, dozens of household brands have gone bankrupt or belly-up in 2020 as the shift from in-person to online shopping hit the turbo button. While the U.S. Department of Commerce estimated online purchasing made up 11% of retail sales last year, it went up to 16% for the second quarter of 2020. At the same time, analysts expect the overall retail pie to shrink more than 10% due to the pandemic-linked recession.

Jie Zhang, professor of marketing and the Harvey Sanders Fellow of Retail Management, said these trends will force brick-and-mortar stores to innovate, renovate, and invent new ways to attract consumers and keep them entertained.

Zhang explains what this upheaval means for consumers.

Be suspicious of 'sales'

Stores are laden with tons of extra stuff to sell, but people can’t easily browse and aren’t wearing suits, buying school lunchboxes or putting up cubicle decorations anyway, so where’s the attraction? Well, maybe in a flashy and disingenuous, electronic 60% off tag.

So as long as going from store to store to comparison-shop is unadvisable from a public health perspective, Zhang said consumers can still play sales detective online and check out what a blazer or lamp is going for elsewhere and see if the so-called sale is just numerical wool over their eyes.

“Some sellers just artificially raise the list prices and offer seemingly deeper percentage discounts,” she said. “Focus on the actual prices that are charged.”

Don’t be afraid of generic

No matter how much you love Coke Zero or Clorox, the stress on supply chains remains. You may have already discovered your particular grocery store shelves are bare of your favorite brands. So even if you had less than savory childhood experiences with the store version, Zhang said give it another try.

“They really have been improving for a couple decades now,” Zhang said. “You might be happily surprised.”

Lots of stores even have “premium” varieties, she said, such as Target’s “Good & Gather” grocery line, that favorably compare to behemoths. Buying store brands can be a great way to save money when the budget is tight.

Focus on helping small businesses

If the bankruptcies of J. Crew or Lord & Taylor sent a shockwave through your closet, redirect that pang of grief toward the small, independent boutique down the street struggling to survive.

The large retailers hitting the skids have creditors, private equity and teams of lawyers that can guide them through the financial storm or shutter peacefully, Zhang said; but many small local businesses have little resources to tap into. If you have the cash and want to make a difference, buy local.

“Many of them are really facing an existential crisis,” she said. “This is the time to step up and help them survive.”

Beware of subpar PPE products

In a world where everyone suddenly needed a face mask to go to the grocery store, retailers were quick to pivot and offer varieties in all shapes, sizes and prices (Louis Vuitton, anyone?). But shoppers’ urgency and businesses’ eagerness to accommodate an exploding demand has led to an unfortunate outcome: shoddy merchandise, Zhang said.

So when you’re looking for a mask or other protective gear, investigate the sellers, see where their operations are based and whether they mention quality control measures. Read consumer reviews and don’t just look at an average rating—make sure they are based on a large number of reviews. That way, you’re more likely to avoid buying hand sanitizers with dodgy ingredients or face masks that don’t have a filter inside.

Reward businesses taking the pandemic seriously

Businesses are struggling with the new normal as much as your average consumer, Zhang said, so if you go to a store or restaurant that has good sanitation practices and makes you feel comfortable, go back there and tell your friends and family about it. Likewise, if you don’t like what you see, vote with your feet and leave.

“This also will give a nudge to those businesses that are not careful enough—it’s bad for employees and it’s bad for business,” Zhang said. “They need to give customers reassurance. That’s how to rebound.”

–By Liam Farrell. This article was originally published by Maryland Today and is republished here with permission.



About the Expert(s)

Jie Zhang is a Professor of Marketing and the Harvey Sanders Fellow of Retail Management at the Robert H. Smith School of Business at the University of Maryland. She received her Ph.D. in marketing from the Kellogg School of Management at NorthwesternUniversity. She was a faculty member at the Ross School of Business at the University of Michigan prior to joining the Smith School. Her general research interest is to apply advanced econometric and statistical models to study consumer purchase behaviors and retail strategies.

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