The time of the pandemic has brought new patterns of activity in many areas, including retail. Some things, the main one being online shopping, will be to stay, and that will change both the way we act as shoppers and the way merchants work. We are currently making a wide range of predictions, from the fact that nothing will change significantly, to the fact that we will not see stores like today for some time. Which of these will be true will be shown by time, but one thing is clear – bigger or smaller, but there will be change.
Facts and Figures: Stores will change after a pandemicInguna Ukenābele, LETA, especially LR and LSM00:00 / 03:04
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The data of the European Statistical Office “Eurostat” are not flattering for Latvia. Last year, e-commerce accounted for only 10% of the turnover of Latvian companies (excluding the financial sector). Although the volume has grown, it is still one of the smallest in Europe. In the European Union, we are just above Greece, Cyprus and Bulgaria. We lag behind not only Ireland, where last year e-commerce accounted for 44% of corporate turnover, but also Estonia and Lithuania, both of which accounted for 14%.
In retail, however, the situation is better. Eurostat data show that last year e-commerce was a component of at least 17% of the turnover of Latvian retail companies (excluding car sales). Although this indicator is better than in Latvian business as a whole, it should also be remembered that very small companies also work in trade, we are still lagging behind.
Retailers in Denmark, Sweden, the Czech Republic and the Netherlands are in the best position in the field of e-commerce. At the bottom of the list with us are Luxembourg, Bulgaria, Italy, Austria, Cyprus, Hungary and Poland.
Return to stores
The bad news for those marketers who are still not serious about online commerce is that it will not go away and the pandemic of e-commerce has given even more impetus to further development.
There are even experts who state clearly and unequivocally that those traders who do not offer their goods on the Internet will not survive in the future.
However, the future picture may differ in different trading segments.
Food is the sector where face-to-face trade did not stop, even when the strictest restrictions on assembly were imposed. However, audit and consulting companies “PwC “study shows that while before the pandemic, global food purchases lagged far behind other product groups in the world, there was a significant increase during the pandemic.
Also A study by McKinsey & Company The five largest European economies – Germany, France, Spain, the United Kingdom and Italy – show that 15% of their population bought food online for the first time in their lives during the Covid-19 crisis. In addition, half of them have said that they are likely to continue to do so, at least in part, after the pandemic. However, even among those who rated their distance shopping experience as successful, there are people who admitted that they would prefer to buy food in a physical store in the future and consider online shopping to be a short-term solution.
Therefore, it is precisely the future of food trade that is currently an issue where experts have quite different forecasts. Some believe that the internet will continue to play a major role in the purchase of food. However, there is no shortage of experts who mention that it will be the grocery stores that will be the fastest to see live customers on their premises, if not in the same number as before the pandemic, then very close to it.
Researchers at McKinsey & Company also point out that the situation in this regard can vary quite significantly from country to country, and the decisive factor will be how quickly and easily it is possible to receive food ordered online.
However, food traders may also face another type of challenge. When restaurants and other catering businesses become fully operational again, many will want to enjoy the experience again.
As a result, food retail volumes, which increased during the pandemic as many cook at home, could decline again.
The concept of the store of the future
However, for traders in other segments, the post-pandemic period can be much more challenging and the future uncertain. Many people are longing for family and friends, cultural events or nightclubs during a pandemic. However, PwC also points out in its study that during a pandemic, we are simply accustomed to doing many things digitally – including shopping.
Therefore, there is no shortage of trade experts who point out that the transition of basic trade to the digital environment is only a matter of time, as it has a number of advantages. It is much easier to compare prices, to study the parameters of different goods, moreover, even borders are no longer an obstacle to the purchase of the viewed goods. Also, the pandemic with closed stores has forced many to try distance shopping for the first time, significantly increasing the number of online store users.
So the question is, will there be little need for the shops we know today and will the large malls not turn into half-empty ghost houses?
A number of experts point out that in the future, the function of clothing, furniture and many other stores will rather be to serve as a kind of showroom.
in which buyers, if they so wish, will be able to touch or try the product in question, as well as talk to consultants. However, the volume of basic sales will move to the Internet and instead of large store premises, warehouses will be needed to store and deliver goods.
Audit and consulting company Deloitte in its study on the future of shopping centers, points out that the big challenge for shopkeepers now is to find the right balance between online shopping and physical shops, as changes during the pandemic have raised the question of whether a range of product groups will need such a large chain as before. According to Deloitte, this applies in the first place to traders in electronics, books and media, sporting goods and consumer fashion, as the ‘go-ahead’ of these goods has clearly shown that they are relatively easy to sell and consumers like to compare easily. their prices.
In addition, it is now emerging that the path of product choice has become completely different. If in the past people went to the stores and then looked for what they needed, now very often shoppers have already researched the offer on the Internet and go to the store only to see again in person whether the thing they are looking for is right for them.
Therefore, if the store staff is currently unable to provide expert advice to customers, the physical store becomes almost redundant.
Deloitte’s findings on the future of shopping centers are also interesting. Until now, the main “attraction magnet” of the centers has been fashion stores. However, with the “path” taken by clothing and footwear buyers to online stores during the pandemic, this could change. On the other hand, customer surveys suggest that in the future the main reason for visiting the shopping center may be to find a variety of catering companies in one place, from takeaway to interesting restaurants, which allows you to fear something new and exotic. According to experts, food in supermarkets may become the new fashion.
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