Retail

Limited Retail Reopenings Draw Curiosity, But Not Spending

The great retail resettling is on. This past weekend and today (May 4) are the first tests of consumer behavior during the pandemic, as Simon Property Group and Macy’s lead the list of major reopenings. Most states, and Simon for that matter, postponed their May 1 reopenings to May 4. However, Texas retail opened for the most part over the weekend, with results that showed consumer behavior to be curious rather than aggressive.

According to WFAA in Dallas, malls around North Texas, while open, “do not resemble anything like what a typical weekend shopping experience looked like just a few months ago. There was just a smattering of vehicles in expansive parking lots. In Dallas, NorthPark Center has just the north and south entrances open and labeled for curbside pickup. Its website helps customers keep up with which stores are open inside.”

An early look at this week’s scheduled mall reopenings indicates that not many stores will actually be open, and that hand sanitizers and masks will be the order of the day.

The cautious approach is hardly surprising. This week’s edition of the PYMNTS COVID-19 Tracker confirms what the aggregated exclusive research has been showing for weeks: Nearly twice as many Americans have little or no interest in leaving their homes to reengage in the physical world as those who do. Just 28 percent of U.S. consumers reported being very or extremely interested in reengaging, with 51 percent being slightly or not at all interested.

“Consumers are basing their decisions on their understanding of the medical risks based on information from credible scientific sources,” says this week’s PYMNTS report. “Nearly twice as many consumers are putting more stock into what medical science is telling them will lower their risk of contagion than what governments say is safe to do. Those consumer cost/benefit analyses weigh what scientists and medical professionals say about when it will be safe for themselves and their families to leave their nests.”

The analysis calls into question the timing and merit of the Texas decision to reopen nonessential retail. Most federal guidance recommends 14 days of a declining infection rate. Texas is just the opposite. On April 25, according to the Texas Department of State Health Services, the state had 666 new COVID-19 cases. By May 1, that number had spiked to 1,033.

“After the economic destruction from the last two months, it’s clear we need a more calibrated approach than what we’ve been living before a vaccine is developed,” said an op-ed in The Dallas Morning News. “That said, the hope of normal must be marked with a dose of realism. This is not getting through a series of reopenings without spikes in infection and we are in the clear come July. The head of the Centers for Disease Control and Prevention recently said it’s not a question of if coronavirus will return in the fall; the virus most certainly will. This time must be used to get ready.”

"People are scared, and most believe it is too soon for many nonessential stores to reopen. An open store does not mean it will have shoppers," said Matthew Freeman, associate professor of environmental health and epidemiology at Emory University, in a CNN report.

According to CNN, Cowen research released last week found a "general lack of confidence among consumers in returning to key business industries," including retail. Nearly 50 percent of shoppers say they will plan to shop for clothing, but will avoid the dressing rooms, according to surveys by Jefferies.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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