Retail

Retailers Prep For More Reopenings

Retailers Prep For More Reopenings

The world of physical retail is slowly beginning its grand reopening.

In Massachusetts, stores are reopening for the first time since mid-March, and in COVID-19’s epicenter of New York City, nearly 400,000 workers are readying to return to retail, manufacturing and construction jobs as the city’s first phase of reopening commences according to The New York Times.

In the Southeastern United States, where social distancing rules have been relaxing over the last several weeks, retail stores are already open for business, albeit under new restrictions. Store capacity is capped, store workers are wearing masks, and temperatures are being checked at the door.

As shops are reopening for business or readying nationwide, the question about consumers is becoming increasingly pointed. Retail workers may be ready to get back to their jobs, and stores may be ready to serve, but it still remains to be seen if consumers are ready to shop in a physical store as they once did.

And, according to PYMNTS’ latest consumer survey on the The Great Reopening: Doubling Down On Digital those are some very seriously open questions. On the upside for physical retailers, consumers on the whole are not as concerned with the virus as they were a few weeks ago. The share of those who reported being “very” or “extremely” concerned about COVID-19 has dropped to 60.4 percent, down from its April 11 peak of 69.5 percent. Those concerns, most notably, however, are not evenly demographically distributed. Generation Z and bridge millennials are the age groups most likely to be “very” or “extremely” concerned about the virus, with 65.4 percent and 65.2 percent reporting high levels of concern, while baby boomers and seniors only report a high level of concern at 57.6 percent.

While falling consumer concern could be considered a plus for the future of physical retail, that tailwind seems to be offset by the reality of how resolutely digital consumer have gone over the last several weeks — and how genuinely reluctant they might be to reset their newly digitized lifestyles.

According to our most recent figures, 82 percent of consumers report shopping with merchants that have upgraded their digital capabilities since the outbreak began.

Among the most common options are online ordering for curbside pickup, which 55.7 percent of consumers report their favored merchants have added. Also popular have been contactless payment options, which 47.1 percent of consumers say their merchants are now accepting.

Online orders for delivery have also increased, as have delivery tracking capabilities available to customers. According to our research, 46.7 percent of consumers report that merchants have improved their order-ahead for delivery services since the pandemic began, and 34.7 percent report that merchants have updated their online inventory status features over the last 12 weeks to make it easier for consumers to check whether items are in stock before they journey to stores.

More important than what has been added is the degree to which consumers are tailoring their journeys around what digital capabilities are offered. Just over a third, 33.8 percent of consumers, reported that they are “very” or “extremely” likely to consider such offerings when deciding where to shop, while another 55.3 percent said they were “somewhat” or “slightly” likely to factor digital capabilities into their choice. Those who aren’t thinking about digital these days are a rather extreme minority in the world of consumers; only 11 percent reported that digital offering has no weight in their decision-making process.

And while avoiding the virus continues to be a leading consideration for consumers choosing digital, it is not the only one. Among those we polled, 21.9 percent said shopping digitally is more convenient, while 14.4 percent said purchasing is faster. Also notable in the data are the demographic preferences: High-income consumers in particular favor digitally enhanced merchants when it comes time to choose a place to shop because nearly a quarter of them (24.7 percent) said purchasing goods online is more convenient.

Consumers may have made their big shift to digital 12 weeks ago because they had to; in a world where physical stores were closed down, every consumer by necessity became digital first. But even as necessity is passing, and consumers’ overall anxiety is lowering, they might just choose to stay digital not because they have to, but because they want to. Because they find it more convenient to skip the physical shopping experience in whole or in part.

For the retail stores opening their doors, that means availability likely won’t be quite enough to bring the foot traffic back. The digital experiences consumer have learned to favor — contactless payments, online ordering, curbside delivery — will likely have to become part of the standard offering set in the recovery world.

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NEW PYMNTS STUDY: LEVERAGING THE DIGITAL BANKING SHIFT – SEPTEMBER 2020  

The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.

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