It’s a good day to look at what’s in store for retail (pun unintentional).
COVID-19 has given the retail sector quite the drubbing, although it hasn’t meted that out equally. The virus has been a gift to the grocery sector, where panic buying and online shopping took food retail to new heights. Hardware e-commerce has fared well – particularly for stores that already had an online shopping model that could easily accommodate curbside pick-up.
Fashion retail, however, is not having a good time of it.
This isn’t a new turn of events – fast fashion has been suffering for some time now, and 2019’s year-end lists included a long obituary for a number of once-prominent retailers. Sadly, that trend will continue for 2020. As per Scott Galloway, Pivot Co-host and NYU professor, “stores with escalators will fail” – meaning that department stores and retailers like GAP and Anne Taylor might never re-open. However, those that already have a strong digital footprint (think Sephora and Warby Parker) have a good chance of surviving – and thriving – in this ‘retailpocalypse’.
So, what will future retail look like?
Well, it’s a given that e-commerce will definitely be more accepted. An April survey commissioned by Dalhousie University’s Agri-Food Analytics Lab found that 22 per cent of Canadians intend to buy food online post-COVID-19, compared to barely 4 per cent who bought online before the pandemic. Some also predict a ‘democratization of the supply chain‘ – shoppers sourcing foods from regional suppliers before the items ever make it to the large retailers.
There is help available for traditional retailers who want to go online. Shopify recently announced a “fully rebuilt and reimagined” Shopify POS to connect brick-and-mortar and online sales.
As for fashion, it’s expected that second-hand and clothing rentals (also known as ‘recommerce’) will continue to gain popularity. In fact, the clothing rental business is expected to be worth USD $2.5 billion by 2023.
Although COVID-19 has exposed longer-term problems for brick-and-mortar retail and supply chain weaknesses, it is safe to assume that a robust digital sales strategy will be a good base for merchants in 2020, and beyond.
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