Covid-19 and grocery retail: # 3/5: what’s in store for in-store?

Thom Iddon-Escalante

Marketing Director

In this, the third of five posts dedicated to coronavirus and grocery retail, we explore how Covid-19 is changing how we shop, and the implications this may have for bricks-and-mortar retailers.

Short term

Protecting customers

Covid-19 is a rapidly evolving situation; one that requires retail executives to respond quickly and decisively to new events, but never with the full picture. In some cases changes to legislation have forced retailers to act, but, more often than not, retailers have taken the initiative to better protect their customers, staff, and business. Take social distancing: governments across Europe directed supermarkets to ensure shoppers maintain a safe distance from one another. Many retailers preempted this, laying floor stickers to better visualise what constitutes safe distance. Some went further, introducing dedicated shopping hours to serve vulnerable groups. Others are trialing new technologies. Aldi, for instance, has installed traffic lights at some store entrances, only giving shoppers the green light to enter when there’s a safe number of people inside.

Protecting staff

Supermarkets have had to accommodate changes for staff too. Like most businesses, supermarkets have moved hundreds of back-office staff online, implementing technologies and routines to make this possible. Unlike most businesses, however, supermarkets have had to simultaneously expand their frontline workforce to meet surging consumer demand and to substitute elderly and/or vulnerable workers for whom the shop floor has become too unsafe. These frontline workers are performing an essential role in the battle against Covid-19. We should admire them, and, more importantly, help protect them.

Changing fortunes

Different retailers have been affected in different ways by Covid-19. Mckinsey reports, for instance, that inner-city convenience stores have experienced a deep decline in business as more people have worked from home. By comparison, online grocery retailers have seen demand surge, in some cases upwards of 700 percent. For a period in March 2020, Ocado, the UK’s largest dedicated online grocer, couldn’t keep up with consumer demand. And Tesco, another UK retailer, announced it was the first to deliver 1 million orders in a single week. Given this, supermarket CEOs ought to ask themselves: how many customers grocery shopping online for the first time now, will continue once things return to normal?

Long term

Scientists have warned of the dangers of a subsequent waves of Covid-19 in the coming months and years. Even beyond that horizon, though, it’s likely customers will be more conscious of their health and seek to limit social contact with strangers to a minimum.

How might this translate into changes in-store? It’s likely that:

  1. Some temporary safeguards, such as floor stickers and perspex screens will become a permanent feature, sticking around long after the initial threat of coronavirus subsides.
  2. Restrictions on the number of shoppers permitted in store will remain in place for months, perhaps years to come. Retailers might therefore need to rethink layout; a model to serve a quick and efficient shopping experience rather one promoting browsing.
  3. Online shopping and BOPIS (Buy Online Pick-up In Store) will remain popular. Retailers unable to support either offering might consider developing a solution in-house or accessing one via partnerships.
  4. For certain retailers, the “S” in BOPIS will be better represented by “somewhere” rather than “store”. They may better serve their customers with a warehouse and collection zone set up than with a traditional store.
  5. More and more retail operations will be automated. Retailers may soon need to walk a fine line between championing frontline staff (considered essential workers on par with medics and police officers by many) and automating much of the role they currently serve. This is in part to remain competitive in a fiercely competitive market, but also to provide a safer service should a comparable pandemic happen in the future.

What to conclude?

The Covid-19 episode is far from over, and therefore the full consequences are far from clear. It’s safe to assume, however, that changes in legislation and consumer behaviour will have an impact on how we shop and where we shop. The in-store shopping experience as we’ve known it, will not disappear any time soon, but it will be transformed.

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