This is an uncertain time in retail. The COVID-19 pandemic is causing shifts in American consumer shopping behaviors, both in-store and online. These changes are ongoing and will likely continue into the indefinite future, as consumers deal with a new reality that has reshaped their shopping options.
With stores shuttered and supply chains disrupted, shopping is becoming more challenging, and this is compounded by the fact that 49% of consumers are concerned about their financial wellbeing and 67% are reducing purchases of nonessential items. This has left many marketing professionals wondering how retailers can keep up with consumers and better serve their customers.
COVID-19’s Impact on the Retail Industry
Now more than ever, following industry news is the first step in understanding consumer buying behavior. The COVID-19 pandemic has caused huge changes to occur within the retail industry. Many of those changes were painful, with layoffs and store closings. Retail sales in the U.S. dropped a record 8.7% in March 2020, and apparel and accessory store sales fell by a whopping 52%.
Many of these changes were unforeseeable. It is unsurprising that disposable gloves were the month’s retail product category growth leader, up 670%. But some may have been shocked to see that the second-fastest-growing category was bread machines, up 652%. Luggage & suitcases were the loss leaders, down 77%.
Online shopping has seen a tremendous upswing, with 51% of consumers ordering groceries online in the month ending April 7, 2020, including 33% who were doing so for the first time. In contrast, only 11% of consumers bought groceries online monthly during Summer 2019. Target saw a 275% increase in online sales of groceries and other items in the first three weeks of April. Other big winners in online sales were fitness equipment and computers, increasing by 55% and 40%, respectively, in March.
Not all is digital sunshine, however. Electronic device sales have fallen so sharply that Amazon is reportedly predicting a $100 million loss due to clearance discounts on them. Amazon is prioritizing the shipment of essential goods, leading to delays in the delivery of many other consumer goods. The online retailer reportedly plans to postpone its annual Prime Day sales event from July to August or later. Wayfair has already delayed its Way Day.
How Retailers Can Keep Up with Consumers in Changing Times
Against this somewhat grim and chaotic background, the need to gain some understanding of consumer behavior is obvious. There are several steps you can take to remain connected with your customers and observe market trends.
1. Ramp up omnichannel.
If you are already present on a range of media, you are at an advantage right now, with more people spending more time at home looking at screens. Kick your content into high gear. Make it catchier and make more of it. Be responsive to feedback. Monitor social conversations and keep up with your competitors too. If you don’t have a strong social media presence, this is a wonderful time to get started. Instagram has seen a 3.6% increase to 127 million daily users between January and March. It might be a good place to start.
Reach out to your loyal customers with personalized email messages to remind them of a sale, update information about operations, or just say hello. Put a banner on your homepage with news about how the company is handling the COVID-19 pandemic. Elicit inspiring stories to put on your website or offer personal consultations. Luxury women’s wear retailer Olivela offered virtual styling services and consultations with a beauty guru and attained a 20% conversion rate in a two-day event.
3. Spruce up your website.
Your website should be up to date. More people may become familiar with it now without stepping into your store. Consumers are trying new brands when they can’t find their familiar ones; 85% of shoppers say that brands don’t matter in times like these. Besides sales, search statistics should give you valuable information about your customers’ interests.
4. Expand your offerings.
Make sure everything you sell is available online. Given the unpredictable market, you never know what will be a bestseller. Are there forms of payment you haven’t adopted? Now is the time to make ordering easy. Think about gift cards too. With the trouble people are having shopping, they have become a popular option. Egift card sales were up 44% at the beginning of April 2020 compared to April 2019.
Stay in Touch with Consumers via Shopkick
A third-party shopping rewards app can encourage purchases and provide valuable insight into shopping habits. By exposing your brand to app users, you can gather valuable real-time data and observe consumer behavior along the buying journey. You can surprise and delight your loyal customers with an extra reward, as well as attract customers who have yet to interact with your brand.
A third-party shopping rewards app can encourage purchases and provide valuable insight into shopping habits.
Shopkick rewards shoppers with points (“kicks”) for just walking in at over 250,000 retail locations. More kicks can be earned for scanning product barcodes and making purchases. Importantly, there is an online component as well, where Shopkickers can browse the sites of their favorite retailers and earn kicks for making online purchases. Kicks are rewarded for watching informational videos and browsing branded in-app lookbooks as well.
Shopkick is highly gamified. It creates a digital scavenger hunt for users, building brand familiarity and exposing Shopkickers to new products. At the same time, they have a clear, easy path to earning kicks and exchanging them for gift cards to a wide range of popular retailers, restaurants, and more. Consumer shopping habits are meticulously reported, providing you with a wealth of behavioral information and proven ROI.
Shopkick gives shoppers rewards and a little more fun, whether they are shopping in-store or ordering online. This innovative shopping app appeals to the budget-conscious family shopper as well as to the master shopper who knows all the tricks to getting a good deal. While catering to users, Shopkick’s brand and retail partners are provided with high-quality market intel that can guide them to greater stability in this difficult and uncertain time.
You can find out more about how Shopkick works by reading our success stories. To learn how becoming one of our partners can drive new sales and grant you new insights into consumer behavior, contact Shopkick .
Image courtesy of Monkey Business Images