By Jim Dudlicek, Director, Communications and External Affairs
As the coronavirus pandemic wears on, some states are starting to ease restrictions, allowing businesses to reopen. As an essential business, supermarkets have remained open throughout the crisis, adapting operations on the fly to the dictates of social distancing and enhanced safety and sanitation procedures.
Consumers are not expected to immediately or entirely revert to their pre-crisis shopping behaviors in the post-pandemic world, which is expected to be further stressed by high unemployment and possible recession.
How will adoption of ecommerce continue to accelerate? How will new shopping habits influence daily operations and store design? How will a struggling economy impact consumer behavior?
NGA’s recent webinar explored these questions in a discussion with David Bishop, a partner at Brick Meets Click; Mike Davidson, executive vice president of operations at Buehler’s Fresh Foods; and Tenia Wallace, chief operating officer of store décor firm Decorworx.
Here are some key takeaways:
Ecommerce is Accelerating: Household penetration for online grocery pickup and delivery surged from 12.5% in August 2019 to more than 30% in March 2020, or from 16.1 million orders to 46.9 million orders within eight months, a number that continued to rise, surpassing 62 million in April. These numbers are being driven by health concerns, Bishop said; 68% of consumers who shopped online during April gave moderate to high concern of catching COVID-19 as the reason. Even as more businesses start to open back up and restrictions are lifted, safety-minded shoppers are expected to keep ecommerce in their routine in greater numbers for the foreseeable future than if the pandemic hadn’t forced the option. “The motivation to shop online will decrease to some extent,” Bishop predicted, “but if we have flare-ups [of COVID cases], we would expect that would drive higher concern and a move toward online.” Davidson urged grocers to keep up their momentum in providing ecommerce services: “Online ordering will continue to grow – let’s keep getting more efficient.”
Income Declines Impact Behavior: By April, nearly 40% of households were reporting income drops greater than 25% since the start of 2020, driven by rampant unemployment spurred by nationwide lockdowns. Concerns over higher prices and fees associated with delivery favor pickup as the preferred grocery ecommerce option to keep household expenses in check. “We anticipate a surge toward pickup as online shifts account for impacts associated with income,” Bishop said. “Dramatic income drops reduce the likelihood of shopping online because it’s more expensive.”
Safety Breeds Loyalty: Stepped-up safety and sanitation measures went a long way at Ohio-based Buehler’s, noted Davidson, who shared reams of shopper feedback proclaiming appreciation for the steps taken to provide clean and secure stores. While cleaning and sanitizing is always routine for food retailers, enhanced procedures “are now the expected norm,” he said. “We need to maintain social distancing practices for the foreseeable future.” For associates, extra pay, store discounts, extended paid time off and more hiring to handle demand are all good moves to demonstrate employee appreciation.
Connect Through Experience: Concerns over COVID mean shoppers will be hesitant to rush back to salad bars, sampling stations and other self-service offerings. Safety measures should not feel threatening, Wallace said; elegant signage should herald features like hand-washing stations and freshly sanitized carts and surfaces. “Walk through your space and identify all of the areas that can cause your customer to feel hesitant,” she said. “Communicate through your social media, website and customer service of the measures that you are taking regarding their safety.” Once shoppers feel secure, retailers can establish destinations that compel in-store shopping. “Create intrigue – capture those who are going out for an experience,” Wallace said – connect with foodies, provide an education and make authentic connections.
To review this complete webinar, and additional webinars from NGA, visit the NGA Live Learning Center at: https://nga.sclivelearningcenter.com.