Smith Brain Trust / October 26, 2021

How COVID-19 Has Changed the Retail Experience Forever

How COVID-19 Has Changed the Retail Experience Forever

With the COVID-19 pandemic, retailers have innovated and tweaked the shopping experience to meet the demands of the moment and keep consumers safe. But even as the pandemic begins to subside, don’t be surprised if some of those changes stick around for good.

In time, expect retailers to bolster their omnichannel shopping capabilities, says Jie Zhang, Professor of Marketing and the Harvey Sanders Fellow of Retail Management at the University of Maryland’s Robert H. Smith School of Business. As shoppers begin their return to stores, retailers will seek to facilitate a seamless customer experience between their digital channels and in-store offerings in order to create a more intimate customer experience.

The pandemic has accelerated the trend of shifting purchases online, which exacerbated the so-called “last mile challenge” of e-commerce - how to deliver online orders timely and cost-efficiently. One omni-channel strategy embraced by many retailers to flatten the shipping curve is to offer free in-store pickup of online orders, says Zhang. Many retailers had already started this option before the pandemic, and it will become more prominent especially in light of this year’s anticipated shipping delays, she says. It also doesn’t hurt that it comes with added benefits like decreased waiting time and uncertainty with shipping, which can increase customer satisfaction.

But its most significant benefit is that it brings shoppers back into stores. Once they’re there, Zhang says, retailers can make the most of that moment.

“Once you give shoppers a reason to go back to the store, you put them into an environment which is most conducive for stimulating impulse shopping,” says Zhang. “They’ll pass around other aisles and potentially purchase other products of interest that they did not plan to buy in the first place. It becomes a mutually beneficial experience for both retailers and shoppers.”

In encouraging more customer engagement at brick and mortar locations, retailers also have an opportunity to shake up the retail experience by leveraging the space as a showroom for online purchases rather than just a sales channel to fulfill transactions, says Zhang.

This might help retailers utilize e-commerce platforms that consumers have grown accustomed to while maximizing the limited store space to showcase a large variety of merchandise. It also may serve as a boon for retailers selling discretionary or experience-oriented products that benefit from first-person engagement during the purchasing decision process, she says.

“For example, apparel stores may not have to stock every size and color combination of a shirt, instead they can judicially choose pieces that sufficiently represent the different sizes and colors for shoppers to inspect. Once a shopper selects the right size and color, an online order can be placed with their preferred delivery method,” says Zhang.

In addition to greater adoption of touchless payment, shoppers may also notice the usage of touchless technology in other aspects of the in-store shopping experience, Zhang says. While online shopping has gained popularity, brick-and-mortar stores are also embracing digital elements.

“The pandemic made a lot of shoppers concerned about personal health and safety in a store environment, including within dressing rooms,” says Zhang. “Utilizing augmented reality technology to offer virtual try-ons within physical stores allows customers to enjoy the in-person shopping experience without needing to touch products.”

As for the impact on holiday shopping, Zhang says consumers will feel the shopping season beginning earlier with sales stretching over a longer period of time. Black Friday has long held the mantle as the start of holiday shopping and its symbolic significance is sure to persist, but be sure to get started on buying those gifts much earlier in advance, she says.

“While this is something that began prior to the pandemic, COVID really pushed retailers to take actions proactively by spreading their holiday sales earlier in the season,” says Zhang. “Black Friday will always have its symbolic role, but it certainly is not the beginning of the holiday shopping season. With anticipated supply shortage and shipping delays this year, it could well be the finale of holiday bargains.”

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