Lauren Saidel-Baker is an experienced speaker and economist. She graduated cum laude with honors in economics and a double major in religion from Wellesley College. Her experience in finance supports her commanding grasp of ITR Economics' programs and subscriptions and their practical applications.
The COVID-19 pandemic has hit the retail sector hard. US Total Retail Sales in March were 6.7% below the March 2019 level. March data revealed a double-digit decline in several retail sectors, including auto, food service, and electronics. Among the sharpest drops was the 52.0% decline in clothing store retail spending. However, other sectors are seeing increased demand. Grocery store sales were up 27.0% from the prior year, and building materials and garden equipment sales rose 10.1%.
The retail landscape will look different in the wake of the pandemic. As consumers adjust their daily routines to stay-at-home orders, they are also changing their habits. Although some of these changes will reverse as the country reopens, other new behaviors are likely to stick. The shift from brick-and-mortar stores to online purchases, for example, was already underway; the current situation has accelerated it.
What can retailers do?
- The first solution is to step up your own online game. If you haven’t yet invested in an e-commerce platform, you are already late. Ensure that any wrinkles are ironed out early, as customers who are trying e-commerce solutions for the first time – there are many – will always remember that first experience. If it is simple and easy, they are much more likely to make the switch permanent for their future convenience.
- Become the expert on your products. Smaller and specialty retailers may not be able to compete on price with larger players, but they already enjoy a position of trust with their customers. Seek to provide guidance and answers to customers' questions rather than simply offering a product.
- Similarly, brick-and-mortar retailers will have an advantage if they can deliver a customer experience that can’t be had online. Seek to capitalize on existing customer interaction to build relationships, which will translate to loyalty.
- Finally, look to lock in customers into the future. The stay-at-home orders will eventually be lifted, and life will return to a new normal, but the current unprecedented situation will permanently change many consumer behaviors. Consider loyalty offers or recurring sales strategies to encourage your new customers to stay.
If we at ITR Economics can help you identify specific strategies, please reach out!