Consumers Continue to Shop During COVID-19. What Are the Biggest Takeaways for Retailers?

Retail started the year from a position of strength, with holiday sales exceeding $730 billion. Buy online, pick up in-store (BOPIS) was a distribution advantage for physical retailers, and direct-to-consumer (D-to-C) brands and mainstay Amazon.com were meeting their delivery promises. However, with COVID-19, this all came to a screeching halt. States shut down physical stores and supply chain disruptions soon followed.

With stores shut down, retailers have quickly shifted their focus to e-commerce to ensure their customers can get what they need as soon as possible. However, the disruptions have posed some serious challenges. To better understand consumers’ current mind-set, CommerceHub conducted a study — with more than 1,500 respondents across all ages in the U.S. — to gauge consumer confidence as well as identify changing shopping patterns amidst COVID-19 disruptions. The recently released findings of CommerceHub’s COVID-19 Shopping and Delivery Trends survey offer some key takeaways for retailers as they look to find a new way forward.

Shopping for Essential Items Will Move Online Post-COVID-19

Since COVID-19, people are shopping online more than ever, and the trend is likely to continue after the pandemic ends. Our survey found that 69 percent of respondents would be more willing to subscribe to a delivery service for essential items following the pandemic. With more people shopping for their household essentials online than ever before, retailers will need to diversify their supply chains to ensure stability to support a larger market. Supply chain diversification was viewed simply as a competitive advantage in the past, but COVID-19 has made it a necessity for survival. As retailers look to adapt, they can utilize different strategies to ensure that their customers are receiving their orders directly and have a controlled, transparent experience that will keep them coming back.

On-Time Delivery is Having an Impact on Purchases and Brand Loyalty

In March, Amazon moved third-party suppliers out of warehouses to focus on deliveries for essential items. Doing this has had a significant impact on how quickly it delivers non-essential items, pushing delivery dates from two days for Prime subscribers to more than a week, in some cases. The survey found that approximately 80 percent of Amazon Prime subscribers said that the expected delivery dates they're being given could change their decision to continue to purchase items from Amazon, potentially moving them away from their once-trusted source to another retailer that promises faster delivery.

Retailers that can tap into a stocked, reliable network of suppliers and accurately provide delivery dates that are more reflective of their current logistics capabilities are at an advantage and are the ones that are able to offer a better customer experience.

Curbside Pickup is Today’s Winner

As both retailers and consumers embrace the new normal, something that won’t be changing is their desire for convenience. The survey showed that 59 percent of consumers said they're more likely to use curbside pickup post-COVID-19.

Retailers that can provide different ways to shop in a contactless, convenient manner will allow physical stores to more effectively keep up with changing customer needs, not unlike what we’ve seen with the adoption of BOPIS.

Retailers Need to Ensure They Can Meet Customer Needs

While in quarantine, consumers shifted their purchasing patterns. There was less demand for certain types of apparel and more demand for products in categories like patio and garden, spring cleaning, DIY projects, and more. Because of the demand for these types of products, it’s imperative that retailers have a way to quickly fill supply gaps. Out-of-stock items frustrate consumers and negatively impact the customer experience. It’s something that retailers can easily avoid with the right approach — this includes tapping into a broader and more diverse supplier network. Seventy-five percent of consumers said they’ve searched for an item to purchase online, only to find that it was out of stock. Retailers that take the initiative to tap into digital inventory and leverage proper resource planning will be able to keep consumers happy and maintain their go-to status for loyal customers.

The new normal has arrived and retailers must adapt quickly. It’s important for retailers to have a two-prong approach as stores reopen, which includes strengthening their digital supply chain as the emphasis and focus on e-commerce and BOPIS will only continue, as well as find more contactless and convenient ways for consumers to safely shop in physical stores.

Erich Bertsch is the vice president of solutions at CommerceHub, an e-commerce enablement platform for retailers and brands.