The retail landscape has experienced a transformation unmatched in recent history. Since the start of the pandemic, brick and mortar (B&M) retailers have been forced to adjust to customer behaviour shifts, changes they thought would occur over a decade, not a year. As we begin to recover from the grips of the pandemic, B&M retailers will need to measure customer behaviour to build strategies, make investments, and compete in the new-normal marketplace. Fusion can help!
The largest and most obvious shift in customer behaviour has been the rapid move to online. Pre-pandemic transactions made online were just over 10% of the Canadian retail business. As of April 2021, the online retail business had grown to 23%, more than doubling in a single year. As Canada moves from pandemic response to recovery there will certainly be a return to B&M, but new customer habits have been formed and most are demanding that retailers be Omnichannel.
B&M retail shopping, to some degree, continued during COVID-19, conditional on public health restrictions. This caused consumers to reduce the number of times they shopped and the number of retailers they visited. Three key drivers became much more important for customers when deciding on which retailer to visit, all of which were related to minimizing their personal exposure to COVID-19. The most important driver that drove choice was simply convenience: the distance the consumer had to travel to the store location. The ability to get everything in one place also became considerably more important, as having to do a second trip to complete their shopping mission was something customers wanted to avoid. Lastly, low regular prices grew substantially as a consumer priority while having great limited-time sales events decreased in importance as the traditional customer habit of chasing down sales at different retailers was avoided because it meant more exposure to the risks of COVID-19.
The accelerated growth of eCommerce and the expectation that online shopping habits will continue, along with the anticipation of continued impact from COVID-19 and its variants, means the future B&M retail environment will be one of intensified competition for a piece of a smaller pie. However, those who can address customer needs and concerns most successfully by, for example, offering seamless Omnichannel; staying top-of-mind; providing a safe environment with the right assortment and prices, will win disproportionately as customers have shown that they want to visit fewer retailers.