Earlier this week, Store Operations leaders from across apparel, luxury, home, entertainment, and auto parts retailers joined us for a virtual coffee hour to share their thoughts on post-COVID-19 operations. It was exactly the kind of open, free-flowing discussion that retail needs if we’re to succeed post-COVID-19. A recap of the key themes can be found below.
Current operators are being creative and flexible in these extraordinary times
Most operators have significantly reduced store services, and in most cases completely closed stores. Those with reduced store services are being innovative in the way they are staying connected with their customers. Some are offering enhanced fulfillment options such as curbside pickup, personal shopping coupled with home delivery services, and “tele-sales” where individuals can phone in their order from the store parking lot and pay for their items via credit card. In other cases, retailers have reduced sales to only commercial customers. Given that many of these tactics are being put in place due to restrictions on non-essential stores, it’s unclear whether these practices will continue long past the initial store opening period.
There is a renewed spirit of team
Retailers who still had stores open felt that there’s a true sense of team and appreciation for co-workers during this time. One retailer gave their associates the option not to work if they didn’t feel safe. Another retailer noted that they’ve never felt more connected with their associates, and that their Store Managers are noticing a higher sense of teamwork and collaboration.
As stores re-open, safety for associates and customers will be extremely important and must be visual
Safety will be a major concern for associates and customers, as exemplified by the recent Whole Foods and Amazon employee protests. Those on the call felt that retailers themselves will be creating policies as opposed to having them come from government regulations. The focus of those policies will be on things that are visible and communicate trust to consumers and employees. Will those policies become the “new normal” and last for the long term? The consensus was that the more drastic measures (such as associates wearing gloves and masks or plexiglass at checkouts) will not be in place long-term, but a general increase in sanitation procedures is here to stay.
Each retailer will need to rethink many elements of their interaction model
COVID-19 has forced every retailer to examine many core assumptions about their store experience. Specifically, all the personal interactions between customer, merchandise, and employees. Will the exchange of cash be a thing of the past (this group says “no”)? How will returns be handled? What about changing rooms? Will just-tried–on merchandise be put back on the shelves? Will there need to be some visual marker to signal trust in this? What about display versions of merchandise (think iPads) whose pre-COVID intent was to be handled and prodded by customer after customer, day after day. Will that be possible now? There were a lot of question and not many answers.
One theme that did come through was that each retailer is going to need to figure out their unique way to convey trust in these processes and integrate them seamlessly into their version of “retail theater.” For example, instead of just handing out pillow covers to each customer in a mattress store, make it part of the customer service dance: “Would you to like to lie down on this mattress to see how it feels? Let me first put on your individualized pillow–case from this plastic wrap, sanitized for your personal use.”
More store fulfillment options will become baseline expectations for consumers
The crisis has made consumers more comfortable with services like BOPIS, curbside pickup, and home delivery models from brick-and-mortar stores. These store leaders felt that these services are here to stay and will become baseline expectations for consumers. Retailers will need to quickly adjust store and labor models to address this. For example, “Dark stores” – already in local markets, closed to shoppers, only doing fulfillment across that market – may become a more standard configuration for many chains.
APAC offers some hope, but also signals change
There are positive signs coming out of Asia, where many stores have re–opened. Those retailers who have had this experience reported that their stores are returning to “normal-ish” operations albeit with increased cleaning added to daily activities. That is the good news. However, while some shoppers are back, the overall traffic remains down significantly (maybe only to 50–70% of pre-shutdown levels). And those consumers that are back are shopping differently. Conversion rates and basket sizes are both much higher than pre-crisis levels. If this trend becomes the new baseline, we may see a heightened retailer focus on better serving the traffic that comes in, instead of a focus on general traffic driving.
Stores may not re-open soon
April is out of the question, as we all know. But only half of the retailers on the call thought non-essential stores would be any time in May. That means half of the retailers thought it would be even later. Yikes! That is probably longer than most people want to hear.
We understand this is a challenging time for retailers and are committed to helping the Store Operations community through this time. In addition to this virtual coffee hour, we will be offering a number of virtual events and content related to COVID-19 recovery for retailers. Our upcoming events and news resources are below:
- We’ll be holding another virtual coffee hour in mid-May. Email [email protected] to be added to the invitation list.
- Our LinkedIn page will feature the latest news and updates on COVID-19 retail. Follow us here.
- Based on her conversations with retail leaders, Store Operations Council organizer, Cathy Hotka, will provide her insights on the key questions to ask in your post-COVID-19 planning during our April 29th webinar. You can register here.