The Covid-19 pandemic forever changed the business world. The retail landscape alone has been altered forevermore. But that isn’t a bad thing.
The Online Retail Industry Is Continuing to Grow Rapidly
eCommerce was already growing rapidly before the pandemic, but the lockdowns imposed due to Covid-19 pushed a lot more consumers into the online retail sphere.
During the lockdowns, more consumers bought items online. They also bought items more frequently.
According to Digital Commerce 360, that resulted in a gain of approximately $218 billion in the eCommerce sector between 2020 and 2022.
Furthermore, in 2021, the overall consumer spending with online vendors in the United States was $870.78 billion, which was an increase of 14.2% from the previous year. Digital Commerce 360 estimates online sales would not have reached that figure for a further two years.
So, it’s undeniable that the pandemic helped the eCommerce retail sector to become staggeringly more profitable than it would have been if Covid-19 and the accompanying lockdowns had never taken place.
That growing consumer trend of buying more online has continued. The eCommerce sector is still growing substantially.
The Digitization of Business Interactions Has Rocketed
According to McKinsey, Covid-19 has caused a tipping point of historic proportions within the retail industry.
A survey of executives from around the world, conducted by McKinsey, has some very interesting findings. It discovered that companies have massively sped up the digitization of their interactions with customers and supply chains, as well as their internal operations, by up to four years.
Furthermore, the share of digital products in those companies’ portfolios has accelerated by an incredible seven years.
Brick-and-mortar Retail Businesses Are Still Going Strong, But They’re Learning They Need to Adapt
Many predicted that the pandemic would completely destroy the brick-and-mortar retail industry.
While it’s true that many physical stores and other retail outlets closed during the Covid-19 pandemic and lockdowns, the brick-and-mortar retail landscape is, perhaps surprisingly, still going strong.
Even new stores are opening up all of the time. If interested, you can find grand openings and re-openings of stores and services that have recently happened or are coming up in the U.S., by city, at www.openings24.com.
Even though eCommerce is seeing an enormous boost, brick-and-mortar retailers are using new methods to ensure they survive and become highly profitable. However, they’re far from relying solely on online purchases.
It may come as a surprise to learn that, according to the U.S. Census Bureau, only about 13% of total retail sales currently go through the eCommerce channel.
But the role of brick-and-mortar stores is changing. Customers now have greater options with the retailers that are proving they can succeed in the face of the pandemic and the move to eCommerce.
For example, customers can buy items in-store, order online and pick up in-store, and have their purchases delivered. They’re also able to return items through various methods.
The well-known retailer Target is a good example. Believe it or not, Target’s eCommerce sales are growing faster than both Costco and Walmart. The company is achieving that by combining online and offline services, as well as offering more options to its consumers.
For instance, Target customers can order items online and either pick them up without having to wait in line, inside a brick-and-mortar store, or they can simply roll up their cars and have their purchases brought to them.
At the end of the day, it is those brick-and-mortar retailers that are using an omnichannel approach to their sales and strategies that will survive and prosper in the coming years.