How Local Retailers Will Thrive in a Post-COVID Environment
When the coronavirus required cities to introduce stay-at-home policies this spring, the initial impact on retail was immediate and, frankly, scary. “Closed” signs popped up in store windows across the country, foot traffic came to a complete halt in some areas, and some brick-and-mortar shop owners weren’t sure they would make it. An April 8 survey of 100,000 of Faire's independent retailers revealed that most businesses had less than three months of cash on hand, and sales were down by 60 percent to 70 percent. We've always believed that the future of retail is local, but the pandemic created a major crisis we would have to navigate together if we wanted to realize that future.
Despite the initial devastating impact on the retail industry, local retailers ability to remain agile and adapt quickly, combined with overwhelming support for local businesses, proved that local retail may emerge from the pandemic stronger than ever before. As malls and large chains continue to grapple with the impact reduced foot traffic and social distancing will have on traditional retail, we’ve seen local retailers in our community leverage their size to redefine the future of retail.
Here are a few key tactics adopted by the most savvy local retailers that are likely to prevail beyond social distancing and help small businesses better compete against large retailers and e-commerce.
Curbside Pickup and Buy Online, Pick Up in-Store (BOPIS)
As of August, foot traffic had returned to moderate or original levels for 52 percent of the retailers in our community, but 68 percent are looking to alternatives like offering curbside pickup. Not only does curbside pickup and BOPIS appeal to consumers who are cautious about returning to a normal shopping environment, but the long-term benefits include saving on shipping costs and serving those who prefer to browse online.
We’ve also seen that BOPIS can be a great tactic to drive customers into a store to explore other products that may not have caught their attention online. Anecdotally, a retailer in South Carolina reported that 75 percent to 80 percent of customers that pick up an online order end up making additional purchases after browsing in-store.
While curbside pickup and BOPIS have long been used by big-box chains, their customers primarily benefit from avoiding spending hours sifting through mass amounts of inventory, followed by waiting in long lines. The advantages that small retailers gain by offering these tools are adding convenience and efficiency to an already highly curated and unique shopping environment.
Social Media as a Sales Channel
Having multiple sales channels is an essential defense against circumstances like the coronavirus pandemic, or more common issues like a crashed web server. Most experienced small business owners already take advantage of the audience reach and branding opportunity social media provides, but it also can become a central tool to drive sales.
We’ve seen retailers in our community get creative with how they’re leveraging social media — from offering daily deals on Instagram to running a trunk show on Facebook Live. While large retailers have to operate under a one-size-fits-all strategy for their mass audiences, smaller retailers benefit from their ability to establish closer connections with their customers, enabling them to offer a more personalized social shopping experience.
Investing in Email
According to our August 5 survey, 70 percent of local retailers are now investing in new or existing online channels. Big e-commerce players have long held an advantage in the online space, but as more small retailers bring their businesses online, they’re now able to compete in the low-cost, high-return field of email marketing. And while large chains struggle with reaching beyond highly repetitive promotional content, smaller retailers are able to offer unique connections with customers on a more personal level.
We’ve seen retailers in our community leverage email to establish trust and loyalty with customers by celebrating their birthdays, sharing personal anecdotes, or by asking for feedback. These more intimate touchpoints help break through the noise of standard email marketing to keep small retailers top of mind.
Local Retail is Here to Stay
Despite the odds, local retail is successfully evolving to operate within a new normal. By remaining nimble and taking advantage of new opportunities to grow and expand, the independent retail industry is positioned to come out on top and remain the backbone of our local communities.
Max Rhodes is co-founder and CEO at Faire, an online wholesale marketplace empowering small business owners and independent brands to buy and sell wholesale online.