The Changing Retail Landscape Post-Pandemic
Expert opinions about the new normal in the retail world post-COVID-19 are plentiful.
While laying no claim to being correct in my views about what comes next, I do have a great deal of experience in the retail space and therefore have formed some views regarding the future of retail. I am optimistic regarding what comes next, and in particular regarding the impact of innovation on both digital and physical retail.
We are witnessing cataclysmic changes in the retail world. Each day brings news of bankruptcies and store closures, and make no mistake, more will come. Here’s the thing, these bankruptcies and closures were going to happen with or without the pandemic. It has simply accelerated changes that were inevitable.
We are still shopping and will continue to do so, only now we don’t have to travel any farther than our laptop or phone for many items. This is a shift that was happening long before Covid-19 entered our lives.
There has been plenty of innovation in the grocery store industry, with fantastic new offerings of ready to eat fresh foods, and a focus on omnichannel shopping. The best grocery stores have learned to adapt to this new world where consumers look to them for fresh foods, ready to eat meals and inspiration.
Unfortunately, many traditional, undifferentiated grocery stores have been losing relevance for years. The pandemic lockdown forced people to figure out how to download online shopping apps and sign up for in-store pick-up and better yet, contactless delivery. Many of us are never going back to crowded parking lots, and navigating endless aisles, especially with the new norms of one-way aisles and 6-foot distancing. The coming years will see many older, undercapitalized grocery stores closing as a result.
During this very strange time we are living through, we have come to like the experience and convenience of buying what we want and getting it when we want it, (even when next day delivery isn’t fast enough).
Similarly, department stores, at least the vast majority of them, are no longer relevant and haven’t been for some time. And without department stores to anchor regional malls, they too will lose their relevance. This lack of relevance predates the global lock-downs and shuttering of businesses. One only had to go visit a grade C or D mall anywhere in America over the past few years. Many boasted more empty storefronts than inventory, and more employees than customers, to see that it was only a matter of time before the clock ran out on these shopping meccas. Why travel all the way to the mall with the faint hope of finding jeans in your size, when you can get exactly what you want without having to get in the car, hop on the bus, or even put on a pair of shoes?
Large department stores that don’t necessarily cater to our taste or needs are quickly becoming relics of the past. Today we prefer the inspiration and discovery that comes from shopping at curated physical stores that focus on our particular lifestyles, an experience that’s difficult to replicate online.
So yes, retail is changing. Adapting and pushing creative solutions is now a requirement, not an option. Some jobs will be lost, yet many new jobs will be created. We can choose to mourn the losses, however, I suggest we turn that grief into optimism about how creative and adaptive we have been, and continue to be, as the world continues to rapidly change ahead of us.
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Craig Herkert is a member of the Eleven Canterbury network. He held executive leadership positions at Albertsons, was the President, CEO Americas at Walmart, and President, CEO of SUPERVALU. He currently sits on a number of Advisory Boards including Whole Coffee Co., GrocerKey, Transparent Path, Tea Drops, Switchboard Sales and the Opus College of Business at The University of St. Thomas.
