COVID-19 has prompted some extreme changes in consumer demands and spending patterns, so how are brands reconnecting with customers for a post-pandemic future?
The start of lockdown was for many a rapid and brutal change to everyday living. Work and education took on a very different look as people congregated at home in their household bubbles. Bricks-and-mortar retail simply shut down and typical customer habits were upended overnight.
Research from Superdrug parent A.S. Watson showed that in a global survey of 22,000 people in 20 markets, post-COVID-19 more than 80 per cent will continue to shop online; however, almost 100 per cent would go back to physical stores when they could, particularly Generation Z.
But, as we emerge from lockdown, shockwaves are still being felt across the high street. Retailers are trying to work out how the brief but wholesale shift to online has changed future customer shopping habits and what it means for their omnichannel strategies.
Online shopping’s critical convenience
“We went from a legacy business 65 to 35 per cent in favour of shops to suddenly being thrown into ecommerce. It brought some short-term changes in consumer behaviour, but some will remain long term,” says Louise Salt, chief customer officer at Crew Clothing.
Home entertainment was key during lockdown, something Hobbycraft was well placed to serve. “We are doing all we can to embrace the increased customer demand, be it by increasing our ecommerce capacity, offering online craft workshops via Zoom or adapting our process to cater for our click-and-collect service,” says customer director Katherine Paterson.
The key will be in keeping that momentum post-COVID-19. “We have adapted our plans to offer more chances to learn in a digital way, as our in-store workshop programme has been temporarily paused. The digital version of our Kids Craft Club was extremely successful,” she adds.
Chris Elliott, digital shelf analyst at retail insight specialists Edge by Ascential, believes the biggest change in future customer habits post-COVID will be in delivery and tech. “That will be here for some time,” he says. “At Christmas, shops like Aldi will see a big influx, but they will run all of that through the Deliveroo app. It will be a Christmas essentials service to make things seamless for the shopper,” he says.
COVID accelerating digital transformation
Salt notes that COVID-19 put something of a rocket under Crew Clothing’s digital plans. “We had to work quickly to get them over the line quicker than we ever imagined,” she says.
Jewellery brand Pandora also had digital plans underway, but its senior vice president, chief digital and omnichannel officer David Walmsley notes the company had to “turbocharge” the online service. He says markets where customer habits weren’t naturally online had a COVID-19 boost. “Italy went off the scale. People who were too nervous to shop online came over and that won’t change,” says Walmsley. “It has set us up for the next phase of transformation.”
Superdrug chief executive Peter Macnab believes beefing up digital stands the company in good stead to address future customer needs. “We are working to future-proof online distribution and have tripled capacity by introducing 30 night stores for quick fulfilment and to meet increased customer demand. This expansion will help make important customer events such as Black Friday and Christmas even bigger and better in 2020,” he says.
Building up confidence in bricks and mortar
Pandora’s Walmsley adds: “We sell emotion, we don’t sell jewellery,” which is why he believes customers will still want to shop in-store. “It’s a very high-touch product. There’s the endorphin hit of finding just the right thing and putting it in a lovely bag. Online we can create a satisfying experience, but it’ll never have that emotional hook.”
Edge by Ascential’s Elliott sees the future customer demanding much more in the way of retail theatre. “Shopping will be a special trip out. It becomes the all-day-out experience,” he says, adding that high street stores could see masseurs and small cinemas adding to the fun.
Even without bells and whistles, simple face-to-face expertise will still be valued. “Speaking to a knowledgeable person in-store gets a level of service, whereas online it’s about convenience,” Salt insists. In-store and online shouldn’t be in competition given how different customer habits are on each platform. “Customers are doing their research online and coming in-store with the intention to buy, not browse,” she says.
Changing customer behaviour demands a new response
But trooping back to the shops is still not a given. Retailers need to address changing customer habits, including sanitation, keeping a distance, mask-wearing and more if they’re to be enticed back. “Reassurance will be up there,” Elliott confirms.
Hobbycraft’s Paterson says: “We have surveyed customers visiting our stores and 96 per cent confirmed they’d definitely return to our stores again, which shows the changes we have implemented in-store to make customers safe are working. We will continue to uphold these.”
Superdrug launched Be Kind, Shop Kind in August to “provide a completely safe shopping space for colleagues and customers”, says Macnab. This includes maintaining social distancing and asking customers not to handle products they are unlikely to buy.
With the in-store retail experience still key to the Pandora brand, Walmsley notes the company will be looking for initiatives to help customers feel comfortable: “Appointment booking and video chats are just two of the initiatives.”
Crew Clothing’s Salt has already explored how the company can respond to changing customer habits, also looking into appointment bookings, extended hours on a store-by-store basis, tailored to local shopping trends and taking out unnecessary shopping steps. “If someone finds what they want in the fitting room, why queue to pay. Pay instead from an iPad or mobile phone,” she says.
Pre-COVID-19, customers rubbed along with the slight mismatch in experience between online and in-store. The pandemic has been the litmus test for many retailers whose experience was not up to scratch. Post-COVID, the future customer will demand more convenience from online, more experience from in-store and a greater confidence that their chosen brands can really deliver the goods.