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Retailers and their sales models have been riding a bit of a rollercoaster since the beginning of the coronavirus pandemic. After struggling to regain their footing thanks to dramatic shifts in shopping trends after restrictions were put in place on both businesses and consumers alike, retailers have continued to benefit from the surge in online shopping when they offer online order pick-up programs to accommodate their customers. Many of them have opted to partner with 3PLs like Redwood Logistics or business strategy consultants to help them implement a new and functioning sales model.
Is the retail industry truly experiencing a sustainable sales model well into the foreseeable future? Or is this a trend that will quickly fade away once the pandemic dies down?
To better understand this shift in business strategy, let's take a look at the benefits involved...
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COVID-19’s far-ranging impacts will continue to be felt, but when consumer’s lives were upended in the US back in March, adaptations were made almost immediately. Before the pandemic hit the US, consumers were already shopping online weekly. So, while e-commerce has been a steadily increasing share of the market, this recent shift further toward it represents an increase of almost a third of all consumers when compared with pre-pandemic numbers.
Almost 30% of respondents to a recent industry survey that took into consideration consumers in both Europe and North America claimed to shop more online than in-person, with a slightly larger number of respondents saying they do a relatively even mix of both online and in-person shopping.
These numbers reflect a massive surge in online orders for many retailers, particularly those in grocery and a large shift away from traditional brick-and-mortar shopping.
Shoppers are now looking for options that allow them to avoid potentially crowded indoor spaces, whilst also having the convenience of same-day access to items. This alone explains the significant surge in popularity of BOPIS models (buy online, pickup in-store), curbside pick-up, and other online order pick-up programs across the retail industry.
In fact, according to a variety of consumer surveys, these surges are likely to continue. Many consumers have utilized this option since the pandemic began, and thanks to the convenience, are likely to continue doing so even after pandemic restrictions are lifted.
Consumers are being cautious, limiting their exposure to the virus as the weather gets colder, forcing people indoors and into closer proximity with one another. The majority of the consumers that were surveyed gave feedback indicating that they prefer to utilize methods of e-commerce that include both BOPIS and delivery over traditional on-site shopping and the surges in online pick-up sales reflect these attitudes.
In addition to the surges in retail sales thanks to the convenience of online pick-up, there has also been a trend toward American consumers buying groceries at both a greater volume and frequency. Many believe this is a direct result of limitations and restrictions placed on dining out- leading to many consumers spending their pandemic downtime improving on their domestic food preparation skills.
With more purchase power shifted from the restaurant and prepared foods industry into retail grocery, the emphasis on various forms of online grocery shopping are likely to continue. And it’s not just Americans trending in this direction. Data has shown that the overall average amounts spent on individual grocery orders have steadily risen in many European countries as well. When compared to last year, pre-pandemic, online grocery orders have increased in frequency for individual consumers by more than half.
With various consumers now using online pickup options in lieu of traditional in-store shopping, it’s probable that consumers who may have previously ignored the option, now familiarized with it, may become loyal users.
There is reason to believe that the lack of options due to the impacts of COVID-19, and the exposure to the convenience of online pickup, has created a large base of committed consumers who will keep the online pickup and delivery market thriving, even during post-pandemic life.