Curbside pickup, delivery and e-commerce will define retail’s next chapter
In light of the coronavirus pandemic’s stranglehold on the American economy, Ad Age gathered insight from chief marketing officers, agency heads and major players at the forefront of an ever-changing retail landscape at Ad Age Next: Retail, a one-day virtual event held July 8 for industry leaders to discuss the state—and the future—of their business.
Here are five of the most important takeaways from the event:
Curbside pickup is here to stay
When brick-and-mortar stores were ordered closed earlier this year to stem the spread of COVID-19, American retailers needed to tweak their operations to stay afloat financially. The solution for many: curbside pickup.
Typically complementing other out-of-store schemes such as home delivery, curbside pickup is viewed favorably by consumers and is permitted under most stay-at-home orders, making it a stalwart of U.S. retail over the past few months. While some companies were hyping their curbside capabilities pre-pandemic—such as Walmart, whose first-ever Super Bowl ad this February promoted its grocery pickup services—others have pivoted as a direct result of the outbreak.
“We certainly brought curbside to fruition in light of COVID,” says Krista Bourne, senior VP of sales and operations at Verizon, adding that for the company, implementing curbside fulfillment was “not on the roadmap” prior to the outbreak.
Likewise, Dick’s Sporting Goods launched curbside pickup nationwide earlier this year, rapidly accelerating it from the development stage back burner. “The conversations about it kind of started on a Friday, and it was live by a Sunday,” Dick’s VP of E-Commerce Experience Miche Dwenger says of curbside. “It’s really been a game-changer for us.”
Brands’ secondary tech investments have been highlighted
As consumers are forced to stay home, customer-facing tech has taken the brunt of shifting shopping habits, facilitating everything from online ordering to sampling products.
To deliver a standout consumer experience that retailers can no longer provide in-store, many brands are making investments in slick technology to appease shoppers.
At Dick’s Sporting Goods, a new e-commerce tool that notifies users when an item is out of stock has been rolled out. Walgreens, meanwhile, revamped its app and data-backed loyalty program. And at Ulta Beauty, the brand has boosted emphasis on its GlamLab AR, a software program that allows consumers to virtually try on makeup products; once a little-advertised feature of Ulta’s app, GlamLab is now front-and-center in stores to replace testing samples.
E-commerce is more important than ever
Consumers have increasingly relied on tech in every aspect of their lives over the past two decades, but the pandemic may have catalyzed the use of new e-commerce tools more than any other single event in the concept’s young history.
“We’ve seen the mass adoption of new behavior,” says Kian Bakhtiari, founder of youth-focused consultancy The People. “That traditional debate around online versus in-store, I think that, in this new world, is no longer as relevant.”
Barbara Kahn, a marketing professor at the Wharton School of the University of Pennsylvania, suggests that the coronavirus pandemic has sped up consumers’ willingness to embrace digital shopping as fundamental to the modern retail experience.
“The trend towards e-commerce, and the convenience of buy online, pick up in store, was happening before COVID occurred,” she says. “And what COVID did was accelerate that trend. What we predicted would take two to three years to happen, happened in a few months.”
Back-to-school is (almost) a sure thing; Black Friday less so
With less than a month until the start of the usual back-to-school shopping season, the U.S. remains a patchwork of rules governing if, when and how students will return to campus this fall—leaving retailers in the lurch with little guidance about what pupils and their families will be in the market for.
“[Students’] needs will be very similar” regardless of if they’re back in the classroom or not, says Walgreens CMO and Senior VP Patrick McLean. “You’re still going to need the supplies that you would need whether you’re doing the work at home or whether you’re doing it at school.”
While many retailers are in back-to-school mode, gearing up for one of the most uncertain fall shopping seasons in recent memory, retail industry leaders are hesitant to speculate how the holiday shopping boom will unfold at the end of this year.
Stephen Howard-Sarin, Walmart Media Group’s VP of Strategy, notes that while the company saw Black
Friday-esque levels of e-commerce sales in April and May, the future of the real thing remains in jeopardy. “Nothing to say about the in-store experience of Black Friday; I think that’s a little too early to call,” he says.
Consumers want contactless options
Due to the ongoing coronavirus crisis and a concerned public, everything from car buying to grocery shopping has rapidly evolved to be contactless—and that includes payment.
“Over 50 percent of U.S. consumers are using contactless today,” says Stephane Wyper, senior VP of retail innovation at Mastercard, noting that a recent company-backed survey found “overwhelming” support for touchless options. And while that upward trend has been evident in recent years, it’s sure to only accelerate amid COVID-19, when merely passing a credit card to a cashier has the potential to spread the highly contagious virus.
To support this increasing desire for contactless payment options, some retailers are doing more than putting a credit card reader on the customer’s side of a plexiglass germ barrier. Verizon, for example, leaned on its app to handle in-store duties including payment and contracts, meaning customers no longer have to handle their wallets or communal pens to make purchases.