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Why a Localized Response Must Inform Retail Reopenings

In the wake of the pandemic, there is no one-size-fits-all answer to designing a brick-and-mortar store plan.

As retailers reopen their stores after COVID-19 closures, the shopping experience and consumer demand in some of the hardest-hit areas are going to differ from those in lesser impacted regions. Additionally, considerations for shopper comfort may vary depending on a brand’s target audience.

During shelter-in-place orders, consumers embraced e-commerce as their primary shopping channel. But now shoppers are starting to return to stores. Sourcing Journal’s “Retail in Recovery” webinar discussed how retailers can plan for the new reality, from safety measures to more digitized customer engagement.

“As the stores are reopening, we’re seeing a significant influx beyond our expectations, customers coming in and willingness to spend,” said Robert Brous, vice president of e-commerce and digital at junior fashion retailer Rue21. “I think it’s a confluence of various things. Obviously some of it’s pent-up [demand] and…we’re social creatures, people are looking to get out, they’re looking to buy and they’re looking to refresh, and as the seasons are changing they’re looking to update. I think some of the economic impact payments and stimulus has certainly helped a tremendous amount.”

Rue21 has looked to establish a safe environment for shoppers and sales associates through measures such as in-store signage and stickers encouraging social distancing and plexiglass shields.

Prepping for safe shopping should also include the point of sale. David Sykes, head of US at payment firm Klarna, sees COVID-19 accelerating the adoption of contactless payment options in stores. For instance, Rue21 has recently extended its partnership with Klarna from its online store to its brick-and-mortar shops.

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Browsing and buying are coming back, but it may be a while before trying on clothing in store is widely available. Reopening fitting rooms will likely take place on a region-by-region basis. Retailers can deploy solutions such as steaming or quarantining clothing to keep shoppers safe. However, Barrie Scardina, executive managing director, head of retail, Americas at Cushman & Wakefield, noted that reopening the fitting room would mean taking associates off the sales floor to deal with these added measures.

Given the challenges surrounding in-store try-ons, retailers could consider extending their return policies to allow customers to feel more comfortable testing out merchandise at home. E-commerce can also pick up the slack by offering solutions such as Klarna’s product, which lets consumers order products, try them on at home and then only pay for what they keep.

Fashion can also borrow ideas from other categories. For instance, Nordstrom’s cosmetic department uses virtual reality mirrors to allow consumers to “try on” shades of product without touching testers or having makeup applied by a consultant.

Moving merchandise

Brous noted that markets with similar discretionary income levels are recovering from the pandemic at different rates depending on how affected they were by the virus. This in turn is determining retail spend.

Following temporary store closures, retailers feel pressured to clear out aging merchandise. But they should strategize sales pushes that move product without tarnishing their brand images or training consumers to seek out a discount.

Part of minimizing markdowns revolves around inventory management and making sure that the right volume of goods gets to the right place at the right time.

Similar to how merchants can take a localized strategy for their safety response to COVID-19, stores can allocate spring and summer products to warmer markets to lessen markdowns since the selling season will be longer. This market-specific merchandise plan should also extend to the timing of back-to-school merchandise availability.

With limits to how many consumers can gather in a store, omnichannel services offer retailers the chance to fulfill e-commerce orders from the sales floor and allow customers to pick up online purchases at the curb.

Looking ahead, Scardina sees an opportunity for merchants to work more closely with their supply-chain partners to time deliveries and improve speed to market.

“We never want to miss a sale,” said Scardina. “It’s like dating—you only get the one chance to make a good first impression. And so there’s such a fine tipping point between being in stock and being overstock and being out of stock.”

Socially distanced service

Pre-pandemic, retail had been investing heavily in experiences, whether that meant in-store dining or entertainment.

The physical store still holds a position as an experiential center and community-building opportunity. But now retailers have to do more to convince consumers to journey to a store. “We need to make sure that the experience in the store is really meaningful if we’re going to come in with a mask on and take that risk,” said Scardina.

Per Sykes, experiential tactics for COVID-19 could include appointment bookings at luxury boutiques or virtual reality experiences in-store.

This experiential push could also extend beyond the limits of the sales floor. As consumers act on pent-up demand, they may find themselves waiting in lines to enter stores. Scardina suggested that retailers devise ways to engage customers during this time, including activations on social media.

“I think retailers are going to have to be very creative in how they still create that lure for the customers,” said Sykes.

Watch the webinar, sponsored by Klarna, to find out:

  • Which inventory management strategies to adopt and avoid
  • What reopenings in Europe and China indicate about consumer demand
  • How retailers should plan promotions
  • What technologies will be key for creating comfortable retail environments
  • How Rue21 is approaching post-lockdown assortment planning
  • How COVID-19 could change the supplier-retailer relationship

Click here to watch this webinar now.