The COVID-19 Pandemic: Where Are We One Year Later? (Retail And ECommerce)
One year ago, COVID-19 was declared a global health emergency, impacting all sectors virtually overnight. With the pandemic hitting this benchmark, Forrester analysts are available for interviews to discuss how specific sectors have been impacted these past months worldwide, as well as what 2021 will look like as we keep adjusting to this “new normal.”
The below insights explore the state of retail and eCommerce:
VP and Principal Analyst Sucharita Kodali:
- “ECommerce has obviously been the big story. Retailers have had to shift faster than ever and some have done really well as a result of that shift — the carriers, Amazon, even Walmart and Target, while others especially smaller companies (some of which still have supply chain issues) are leaving money on the table. Other small merchants like restaurants continue to suffer for other reasons.
- “The big worry for all retailers is how much longer the pandemic will last. That unknown has made many making large capital investments that would transform their businesses. The other question to consider is: Will eCommerce orders just fall off a cliff once people go ‘back to normal’ (whatever that means)?”
VP and Principal Analyst Thomas Husson (Based in Europe):
- “Because of the pandemic, consumers now expect more digital interactions throughout their omnichannel path to purchase, but they also care more about local, ethical, and environmentally friendly brands, especially in Europe. I think consumers’ experiences with COVID-19 will redefine how they behave, consume, and engage with brands as the economic and social crisis peaks later in 2021. Consumers will increasingly feel frustrated, mistrustful, and disappointed, and they’ll exhibit contradictory behavior. Social empathy will drive loyalty and long-term performance for companies. Failure to untangle consumer contradictions will reduce brand equity by billions.
- “The main challenge for European B2C brands in 2021 will be to truly understand customer emotions, to pivot to a digital relationship that transcends apps and websites, and to reimagine the role of emotion in both physical and digital customer experiences. The real change is happening below the surface. And consumers often can’t even voice these changes.
- “Europe will experience a massive eCommerce growth — now representing up to 25% of total retail transactions in the UK versus about 15% in continental Europe. This though, did not compensate for the decline in physical retail sales during the pandemic. Early rebound signs show catch-up consumption is based on a cocooning trend because European consumers remain largely at home.”
Senior Analyst Emily Pfeiffer:
- Nearly 40% of retailers and wholesalers made an immediate increase in tech investment as a result of the pandemic last year, despite an overall reduction in spending.
- “Retail pivoted more quickly than may have seemed possible previously in response to sudden and specific shifts in consumer demands, such as online ordering for curbside pickup:
- These types of projects would usually take years and retailers worked with their tech providers to stand them up in mere weeks.
- The agility that retailers demonstrated out of necessity in 2020 opens the door to becoming more adaptable and responsive organizations in the future.
- “As so many more orders moved to digital channels, retailers worked to expand online assortments by increasing drop-ship suppliers. Brands responded in kind, syndicating products to more websites and marketplaces as online shopping demand shot up and dark stores (whether due to the pandemic or retail shifts already in motion) limited their customers’ access to branded goods.
- “The operational side of eCommerce became the savior in 2020. As products were exposed for sale earlier in the supply chain, more products were syndicated to more digital channels, and retailers spun up creative pickup and delivery operations seemingly overnight. Order management solutions and operational support staff were the heroes swiftly bringing these changes to reality for retailers.
- “2021 is the year to stabilize eCommerce operations. 2020 was a frantic scramble to implement curbside and other delivery options, support the huge swing toward digital, and figure out pandemic-era safeguards. Consumers are now much less understanding when experiences are disappointing.”
To connect further with any of these analysts, please reach out to firstname.lastname@example.org.