COVID-19: Lessons Learned from Italy
By: Jonathan M. Downey, CAE, NGA Senior Vice President, Industry Relations
As many in U.S have entered the “containment” phase which includes self-quarantines, social distancing, an increase in working from home and large group events cancellations, many industry thought leaders are looking to Italy for insights into what could be on the horizon. Italy is now in the “lockdown” phase with enforced quarantines, travel restrictions, and significantly limited personal interaction outside of the home.
Before all of Italy was placed into lockdown, most of the attention was on the Lombardy region, Italy’s epicenter for COVID-19. Data insights provider, IRI, recently shared a snapshot of FMCG sales in Lombardy, in the “lockdown” phase, compared to the rest of the country, still in the “containment” phase. For the weekend of February 23-24, certain categories showed explosive growth in the Lombardy region, even more so than the already increasing sales in the rest of the country. Some examples include:
Lombardy Region: +406%
Rest of Italy: +196%
Lombardy Region: +188%
Rest of Italy: +60%
|Flours / Mixes
Lombardy Region: +163%
Rest of Italy: +85%
|White Bread Lombardy Region: +89%
Rest of Italy: +52%
|Compared to the four weekends prior|
IRI also reported that while in the “containment” phase consumer in Italy were already seeking longer-term solutions, knowing that moving to “lockdown” was likely. Online sales doubled in the first days of “containment” and use of click & collect was up threefold from the same period in 2019.
Management consultancy, McKinsey & Company, held a special webinar for their retail partners on March 17th. They shared a few examples of how retailers in Italy have implement new procedures and protocols to continue to serve their consumers. A few highlights include:
- In-store safety
- Italian retailer, Esselunga, has encouraged self-checkout and imposed 1-meter distance between customers and cashiers. Customers are allowed in stores in batches and drew marks to impose a 1-meter distance in outside queue
- Online and omni-channel push
- Another Italian retailer has increased the number of pick up, click & collect, and drive orders, where customers call the stores to prepare their order. They also reduced the range of products available online to ensure product availability with simpler operations flows (e.g. 5 SKUs on meat)
- Supply chain
- Esselunga increased quantitates sourced for in-demand good, particularly pasta, rice, canned vegetables, baby supplies, and dog food
- To prepare for the increase in online sales, one Italian retailer expanded picking facilities capacities by leveraging stores as dark warehouses
These are just two examples of where thought leaders are looking at Italy to for best practices and insights to help limit disruption in the U.S. As more information becomes available, we will be sure to provide updates.