Topic Talk: Tail End of Retail?

Is COVID-19 the final nail in retail? Or is there hope for recovery?

According to IBM’s annual U.S. Retail Index Study, the COVID-19 stay-at-home orders and closures, not surprising, catapulted ecommerce levels ahead by five years. Also understandable, in-store retail like department stores declined by 75% in Q2. What does this mean in the long-term for brands when stores are open consistently? For 2020, department store sales overall are projected to decline by over 60%. This could be due to findings from Kantar’s COVID-19 Barometer (Wave Five), indicating that 66% of people will continue to avoid busy places like physical retail locations. Furthermore, over 50% of Millennials and Gen-Z think they will continue their newly adopted pandemic behaviors post-crisis. That said, 35-38% of those under 55 do look forward to shopping in person, with the older Boomer generation the most eager at 46%.

Still, the post-pandemic era is still at least 6-9 months away with many stores now open across the country. So how can retailers keep their in-store business going in the short-term, while protecting consumers and staff, and encourage shoppers to return for the long-haul?

Accordingly to the Harvard Business Review, limiting customers in store is the safest protocol. But this significantly impacts on sales which relies on throughout in stores, according to Little’s Law equation: Throughput through the store (in customers per hour) = Number of customers in the store ÷ Time spent in the store (in hours)

The good news is that retailers have a variety of options they can utilize to manage these variables to positively impact sales:

  1. Retailers can tap into the wealth of vacant retail real estate to add temporary/remote locations to accommodate more shoppers (i.e. throughput and subsequently sales) while maintaining social distance protocols in each location
  2. Retailers can also make the shopping experience more efficient, making a customer’s purchase decision faster and getting more customers through the store
    • Increase and maximize staffing like personal shoppers to help customers find what they want and need quickly and so they spend time shopping and not waiting for help
    • Take a cue from grocery stores by implementing one-way traffic aisles and having specific shopping periods for older customers, not only protecting them but also ensuring shopping pace is similar
    • Try introducing appointment-based shopping to help anticipate crowds and staff accordingly
    • Group fast shopping items together for easy access, while slower shopping items can be more spread out around the store
  3. Continue to offer conveniences that are now expected by all customers such as in-store and curb-side pick-up, which 40% of shoppers said make them more likely to purchase from stores that have this offering vs. those that don’t

Retailers and brands also need to have an even stronger customer care strategy than ever given common problems like inventory unavailability/fulfillment. This means being even more transparent to shoppers across all touchpoints during their entire experience, whether it be in-store or on-line. This will also have the added benefit of reducing already long call-wait times and volume of messages.

With these strategies, retailers can best position themselves for success not only during the pandemic but after!


Questions, Comments, and the Future


  • Is making in-store shopping safe and convenient enough to beat back the online shopping acceleration brought on by COVID?
  • What will the holiday shopping experience look like this year, as shoppers worry about economic uncertainty and the potential of getting sick, not just from COVID but the flu?
  • Will the continued time delays and packaging waste with online shopping, and frankly the need to get out of the house, entice shoppers back to brick and mortar faster and in higher volume than even pre-pandemic time periods?

Need help adapting your business and marketing strategies to current and future audience shopping behaviors? Ignited has over 21 years of experience analyzing the landscape and pivoting strategy, research, and in-market executions across all verticals accordingly. Contact us for a free consultation today!


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