Pandemic-induced social distancing, reduced hours of operation, and even continued lockdowns and closures could dramatically change Christmas shopping behaviors in 2020, requiring retailers to find new ways to serve holiday shoppers and generate sales.
“There is definitely uncertainty around in-store shopping … with Covid,” said Robert Fagnani, head of business development and operations at Formation, a personalization platform.
“If you imagine crowded stores and long lines, especially around Black Friday — I don’t think we are going to see that happening. One, because people are getting smarter about how to stay safe in the pandemic. And two, a number of state and local governments or jurisdictions … are going to place requirements that won’t allow that type of behavior to happen.”
If you imagine crowded stores and long lines, especially around Black Friday — I don’t think we are going to see that happening.
Notwithstanding local or state mandates, omnichannel and brick-and-mortar retail businesses don’t necessarily want packed aisles and crowded stores on Black Friday either. Thanks to the ongoing coronavirus pandemic, crowds create at least three potential problems for physical shops.
Danger to employees. An employee who contracts Covid-19 is certainly in danger. That should be a company’s primary concern. Beyond that individual’s wellbeing, the business loses a worker for two weeks or more, and, in some areas of the country, that retailer will have to close its store while the rest of its staff is tested and, potentially, quarantined. A bit of Black Friday hype and the associated in-store crowds could shutter a shop for the rest of the holiday season.
Some consumers are looking for a fight. There have been many instances of consumers entering stores and challenging employees or other shoppers over the requirement to wear a mask.
“Two men were not wearing face masks when they entered a Trader Joe’s in Manhattan earlier this month. But when some of the grocery store employees asked the pair to cover their faces, they refused — and went on a rampage instead,” wrote reporter Teo Armus, in The Washington Post on July 29, 2020.
Unfortunately, this is just one example. There are many more, and Black Friday crowds could make things much worse.
Legal liability. At the time of writing, there was no legal protection for businesses from coronavirus liability. If she became sick with the coronavirus, a store’s shopper could, in theory, sue the retailer, arguing that Black Friday promotions encouraged crowds and, thereby, irresponsibly spread Covid-19.
As insane as this may seem to some in the retail industry, it is important to remember that there is also very little protection for coronavirus victims who may need to take extreme steps to pay their medical bills, which for some patients exceed $1.5 million.
“I think many customers today — even if they are living in parts of the world that have stabilized Covid … or where we don’t feel at high risk because everyone is wearing masks — are still feeling very unsettled and uncertain going out, certainly for anything that isn’t very targeted, very specific like grocery shopping. They’re just going to opt-out of doing it that way,” said Brian Walker, chief strategy officer at Bloomreach, a customer experience platform.
To Walker’s point, many shoppers have changed their buying behaviors so that despite Black Friday promotions, they may not want to venture out to a store, especially if they expect it to be packed.
A Different Plan
So here is the rub. Nearly all retail businesses — brick-and-mortar, omnichannel, and pure ecommerce — need a robust Christmas shopping season with lots of sales. But this year they probably cannot promote Black Friday, Cyber Monday, or even Christmas Day the same way that they have in previous years.
Brick-and-mortar stores will require an online presence if they hope to compete.
“Call it a slow hunch,” said Bloomreach’s Walker, “I think many of us expected that digital commerce, that digital experience was, of course, going to continue to grow in importance, and it certainly has, but since Covid began, it went from important to urgent for many companies.”
Retailers that don’t have at least some form of online presence and the ability to offer pick-up or delivery will likely miss out on some holiday sales this year.
Omnichannel retailers should emphasize ecommerce and click-and-collect shopping to avoid the dangers associated with overcrowded stores and Black Friday lines. This may require better, cross-channel shopping experiences.
Selling things during the pandemic and advancing the digital experience “has played out in a number of ways during the Covid crisis,” said Walker, “including [merchants] adding the ability to search, and sort, and refine based on what’s available for pick-up in their local market rather than [the customer] being frustrated to purchase an item and discover later that it is not available in their local store.”
“Consumers have already been programmed over the last four, five, six months to shop online. Granted, most of it is for consumer staple products and essential items, but I think we will start to see that shift more into some other discretionary categories as people are thinking more about gifts,” said Formation’s Fagnani.
“For people that want the certainty that something is in stock — I’m sure everyone has found something that is out of stock throughout the last six months,” Fagnani continued, “we will probably see an uptick in people doing contactless delivery or pick-up at the store for certain products so that they know they are actually getting the item that they want.”
With this focus, omnichannel retailers may still be able to enjoy a strong holiday season with their stores open. The aim is not to close stores completely, but rather to avoid long lines and massive crowds. And by avoiding crowds, these businesses may be preserving the in-store shopping experience.
Pure ecommerce retailers would seem to have an advantage because they are already online. And with big businesses cutting back on some advertising spending, promotional costs for ecommerce merchants may be flat or up only a bit in 2020.
Unfortunately, there could still be challenges with shipping, new competition (i.e., omnichannel and brick-and-mortar companies now focused on online sales), and even product availability. With this in mind, ecommerce retailers in 2020 may want to “flatten the curve” of holiday revenue, and generate sales as early as possible.
Regardless, treating the 2020 holiday like it was 2019 won’t work.