[{"@context":"http:\/\/schema.org","@type":"Article","@id":"https:\/\/www.the-future-of-commerce.com\/2021\/01\/06\/brick-and-mortar-after-covid-19\/#Article","articleBody":"In many ways, the current state of the retail industry resembles the pinnacle scene of a good mystery, with folks trying to solve what will happen to brick and mortar after COVID-19.\nThe triggering event occurred several scenes ago. When the pandemic caused shutdowns around the globe, retail foot traffic had gone missing. For example, the U.S. had an 82.6% year-over-year foot traffic plunge for the week ending April 18.\nSince then, the intrepid detectives in our story \u2013 retail brands \u2013 have launched widespread investigations into their business models. Their goal has been to restore order by finding a digital-first path to short term resilience, medium-term recovery, and long-term growth.\nWith 2020 behind us, brands have gathered facts, analyzed clues, and identified key suspects. Now, with suspense filling the air, they\u2019re ready to present their case for a more resilient growth strategy for 2021 and beyond.\nFact: Digital-first business models help preserve market relevance\nOnce the lockdowns began, retail brands jumped into their digital strategy with both feet out of necessity. Ratul Shah, head of product marketing for SAP Customer Data Cloud, says signals of online activity skyrocketed soon after January:\n\u201cAll of a sudden, digital had to support the physical business. More and more people went digital. Apps came out at a rapid rate. More accounts were created\u2026\u201d\nStill, the key question remained: Could the increases in online sales make up for the loss of foot traffic?\nAfter all these months, results are mixed. Increased e-commerce activity has helped bring in revenue, but in many segments hasn\u2019t made up for the decreases incurred by in-store and wholesale business models.\nExhibit A: Comparing Q3 2020 and Q3 2019:\u00a0\nCompany\nE-commerce growth for Q3 2020 YoY\nOverall Sales for Q3 2020 YoY\nLevi Strauss & Co.\n52%\n-27%\nOffice Depot\n20%\n-9%\nH&M\n24%\n-16%\nAs these numbers show, even retail brands with successful digital strategies are facing an uphill battle recovering from the pandemic, yet this doesn\u2019t mean they\u2019re pulling back. On the contrary: many brands are accelerating their digital transformation even more.\nAs H&M CEO Helena Helmersson said in her company\u2019s earnings statement: \u201cWe are now accelerating our transformation work so that we continue to add value for our customers.\u201d\nThe new suspect: Online baby boomers\nIf nothing else, the pandemic has sparked a dramatic change in online shopping audiences.\nIn a recent survey by the Economist, Baby Boomers demonstrated the biggest shift to online activity since the start of the pandemic. This group increased their online spending as a share of their total spending from 25% to 37%. Gen X came in second, increasing their share of online spending from 39% to 47%.\nThis shift to online shopping \u2013 especially among older cohorts \u2013 presents a unique opportunity for brands and retailers to engage new online customers.\nThe clue: New perceptions of convenience\nThanks to digital-first strategies, consumer expectations are rising even higher. Lisa James, product marketing manager for SAP Commerce Cloud, said convenience is a primary driver of these expectations.\n\u201cThe convenience to shop anywhere is the number one reason why consumers are preferring to shop online, and they\u2019re likely to continue to shop that way even as COVID restrictions ease.\u201d\nFor most shoppers, the idea of a convenient customer experience centers on friction-free engagements. If brands can make everything from the log-on, shopping cart, check-out, and e-receipt process seamless, they\u2019ll be in good position to win repeat business.\nThe \u201cfriction-free\u201d factor isn\u2019t limited to the online experience. In anticipation of shoppers returning to stores, retailers are focused on ways to make physical shopping more convenient as well.\nAs a result, many brands are working now on processes to offer contactless payments and app-based scan-and-pay systems in store so they can lift conversion and retention rates when the foot traffic returns.\nThe verdict: The connected store will be vital for brick and mortar after COVID-19\nRetail brands have pursued the idea of the connected store for many years now. This idea involves blending online and in-store experiences to give customers what they\u2019ve been asking for: security and convenience.\nThe connected store concept includes:\nFaster checkout productivity\nHigher staff productivity\nMore inventory turns\nReductions in shrink\nBetter conversion rates\nWhile technological and organizational silos \u2013 combined with the dominance of in-store shopping \u2013 often prevented many brands from achieving this vision, now, because the pandemic has forced digital acceleration to the top of the boardroom agenda, the connected store vision is a blueprint for future success.\nDon\u2019t just believe in the exceptional \u2013 create the exceptional. Fast, flexible, mobile-first e-commerce is just a few clicks away.","author":{"@type":"Person","@id":"https:\/\/www.the-future-of-commerce.com\/2021\/01\/06\/brick-and-mortar-after-covid-19\/#Article_Person","image":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/2021\/01\/06\/brick-and-mortar-after-covid-19\/#Article_Person_ImageObject","url":"https:\/\/23x6xj3o92m9361dbu2ij362-wpengine.netdna-ssl.com\/wp-content\/uploads\/2018\/09\/Maria_Morais-150x150.jpg"},"name":"Maria Morais","sameAs":["https:\/\/twitter.com\/CeuMorais","https:\/\/www.linkedin.com\/in\/ceumorais\/"],"url":"https:\/\/www.the-future-of-commerce.com\/contributor\/maria-morais\/"},"dateModified":"2021-11-01T18:23:36+00:00","datePublished":"2021-01-06T06:16:02+00:00","description":"Retailers embraced digital when lockdowns began. Now that the convenience of e-commerce is clear, what does brick and mortar after COVID-19 look like?","headline":"Cracking the case of missing retail revenue: Brick and mortar after COVID-19","image":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/2021\/01\/06\/brick-and-mortar-after-covid-19\/#Article_ImageObject","height":"630","url":"https:\/\/www.the-future-of-commerce.com\/wp-content\/uploads\/2021\/01\/FCEE095_CrackingCase_HB-1200x630.jpg","width":"1200"},"mainEntityOfPage":"https:\/\/www.the-future-of-commerce.com\/2021\/01\/06\/brick-and-mortar-after-covid-19\/","name":"Cracking the case of missing retail revenue: Brick and mortar after COVID-19","publisher":{"@type":"Organization","@id":"https:\/\/www.the-future-of-commerce.com\/","additionalType":"https:\/\/www.wikidata.org\/wiki\/Q1193236","description":"Relevant, timely information & analysis on commerce trends, both consumer-facing and B2B.","logo":{"@type":"ImageObject","@id":"https:\/\/23x6xj3o92m9361dbu2ij362-wpengine.netdna-ssl.com\/wp-content\/themes\/hybris_foc\/assets\/images\/layout\/logo-new-2x.png?_=1","height":"96","url":"https:\/\/23x6xj3o92m9361dbu2ij362-wpengine.netdna-ssl.com\/wp-content\/themes\/hybris_foc\/assets\/images\/layout\/logo-new-2x.png?_=1","width":"500"},"name":"The Future of Customer Engagement and Experience","sameAs":["https:\/\/podcasts.apple.com\/us\/podcast\/a-call-for-a-better-experience\/id1479742201","https:\/\/twitter.com\/FutureOfCEC","https:\/\/www.linkedin.com\/groups\/4844282","https:\/\/www.the-future-of-commerce.com\/feed\/"],"url":"https:\/\/www.the-future-of-commerce.com\/"},"url":"https:\/\/www.the-future-of-commerce.com\/2021\/01\/06\/brick-and-mortar-after-covid-19\/#Article"},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"2021","item":"https:\/\/www.the-future-of-commerce.com\/2021\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"01","item":"https:\/\/www.the-future-of-commerce.com\/2021\/\/01\/#breadcrumbitem"},{"@type":"ListItem","position":3,"name":"06","item":"https:\/\/www.the-future-of-commerce.com\/2021\/\/01\/\/06\/#breadcrumbitem"},{"@type":"ListItem","position":4,"name":"Cracking the case of missing retail revenue: Brick and mortar after COVID-19","item":"https:\/\/www.the-future-of-commerce.com\/2021\/01\/06\/brick-and-mortar-after-covid-19\/#breadcrumbitem"}]}]