As cities and states start reopening after more than 12 months of COVID-19 restrictions, and consumers start contemplating going back to restaurants, in-store shopping, sporting events and other gatherings, we thought we’d take a look at where things stand in the post-pandemic retail world.
A recent Economist/YouGov poll found that 58% of Americans now believe the worst of the pandemic is behind us; that there may be light at the end of the COVID-19 tunnel. And they’re definitely interested in getting back to in-store shopping experiences: among adults who shopped less often in person over the course of the last year, more than half expressed excitement to get back into physical stores (57%). The same poll found that Americans prefer in-store shopping to online shopping in a few categories, namely grocery stores, drug stores, convenience stores, and super stores like Walmart, but prefer to keep up the online shopping they switched to during the pandemic for most other categories.
In general, consumers continue to love online shopping, which increased overall during the pandemic: 78% of consumers polled in that same Econonmist/YouGov survey said they intend to shop online about the same or more frequently than before. There's good news for retailers: a McKinsey study found that over 50% of expect to spend extra dollars, both online and in-store, by splurging or treating themselves in a post-pandemic world. And they intend to spend soon, particularly on discretionary categories such as apparel, beauty, and electronics.
Retail changes that will stick post-pandemic
In March, we wrote about the changes in retail shopping that happened during lockdown. Now three months later, we’re finding that most of those behaviors will stick post-pandemic: an AlixPartners study found that 50% of shoppers say their buying habits have been permanently changed by the COVID-19 pandemic.
Behaviors that consumers intend to continue post-pandemic include curbside pickup (50% intending to continue), selling/buying via social media - also known as social selling – (92% of Instagram users stated that they click on ads, follow a brand, or make purchases based on an Instagram ads), and contactless in-store shopping (75% of consumers say they now prefer self-service checkouts, chip insert, mobile payments, and QR code shopping).
Interestingly, the McKinsey study mentioned above also found that a lot of brand-switching occurred during the pandemic, as consumers looked for brands which provided convenience and value during lockdown, but also which matched their own updated personal values, like health and the environment. And they intend to stick with the new brand: of the 75% of Americans who changed their shopping behavior since COVID-19 began, 40% say they have changed brands and will stick with the new brand.
The return of direct mail as part of a post-pandemic omnichannel retail strategy
Despite consumer propensity for online shopping, direct mail and catalogs continue to be a key part of the retail experience. Research finds that consumers are engaging more with direct mail than ever before, making it an even more effective part of an omnichannel campaign: the 2020 Valassis Consumer Study found that 49% of the affluent segment (household income of $100K+) are more excited about receiving mail than they were pre-pandemic, and 44% percent of millennials are spending more time reading direct mail than before. And the real payoff: 58% of millennials, 62% of Gen X, and 65% of the affluent segment said they’d made a purchase in the past 30 days as a result of direct mail advertising.
Whether they’re reading a direct mail ad and then shopping online or in-store, it’s clear that the one of the best strategies for brands to attract consumers in a post-pandemic world is to provide consumers with a comprehensive omnichannel shopping experience set up. Key components include:
- Personalization of messaging, promotions and product recommendations (personalization improves click-through rates by an average of 14% and conversions by 10%, according to research from Aberdeen)
- Coordination (i.e., no silos) of staff and systems across departments and channels to create a seamless shopping experience
- The use of standardized and unified customer data, as well as continuous campaign performance measurement
- Utilizing the right technology, such as a customer data platform, to allow omnichannel journey mapping upfront, effective segmentation, and the ability to use dynamic content for a truly personalized experience
The COVID-19 pandemic will likely turn out to be the biggest disruption to retail in our time. Many consumer shopping habits were altered, necessarily, as the world went into lockdown over a year ago. Now as life returns to normal with economies and borders reopening, many of those shopping habits embraced since March 2020 are here to stay. Consumers will return to in-store shopping but will keep up the high level of online shopping that became the norm in the pandemic. In effect, consumers are now telling brands in which channels they prefer to shop, and they’re not likely to relinquish that power. Therefore, a comprehensive omnichannel strategy is the key to retail success post-pandemic.