COVID-19 is having a negative impact on sales for some retailers and is a boon for others.
Chain Store Age conducted a survey online from March 19-22 asking retailers about how the ongoing COVID-19 pandemic is disrupting retail workflows throughout the enterprise. A leading 39% of respondents said it has had a negative impact on sales. However, a combined 38% reported the virus has been a “goldmine” (18%) or created significant uptick (20%).
Here are a few brief thoughts about the deeper implications of these results.
COVID-19 is hitting some retailers where it hurts
Sales is the lifeblood of retail. No matter how well a retailer communicates with customers, establishes its brand presence, manages employees, and fulfills inventory, if they cannot sell products through they will fail. Widespread loss of sales indicates that consumers being largely sheltered in their homes creates a fundamental downward shift in shopping behavior.
Digital sales aren’t always making up for lost brick-and-mortar sales
Early indicators suggest consumers who do not want to or are no longer able visit physical stores (which are increasingly closing down due to the pandemic) are doing more shopping online. However, the survey question did not ask retailers to specify how COVID-19 is affecting sales by brick-and-mortar and digital channel. Four in 10 respondents stating the pandemic is having a blanket negative impact on sales suggests consumers are simply putting off purchases or buying fewer items than usual, regardless of channel.
Some retailers are stealing market share
Retailers such as Amazon and major grocery, drugstore, discount and dollar store chains are engaged in hiring booms. Amazon has had to focus fulfillment on certain household items, and chains such as Walmart and Target are reducing store hours to ensure shelves can be stocked. Select retailers, particularly those selling food and household essentials, are seeing a positive sales impact from COVID-19.
What you can do
Retailers who are seeing sales suffer due to COVID-19 need to become as flexible as possible in how consumers can purchase their goods. As traditional brick-and-mortar shopping becomes less of an option, retailers need to heavily invest in omnichannel offerings such as curbside pickup, drive-thru pickup, and on-demand delivery.
A wide variety of third-party platforms are available to help retailers quickly launch or enhance omnichannel sales efforts. Retailers cannot manage the duration or severity of the COVID-19 pandemic, but they can manage their response.