In the past few days, both Walmart and Target announced they would not be open on Thanksgiving this year. The decision is in response to the coronavirus, and the fact that the crowds that holiday-season sales draw would not be prudent. “Deal hunting and holiday shopping can mean crowded events, and this isn’t a year for crowds,” Target said in a statement.
There’s also a sense that in-store workers, overwhelmed with months of changing regulations and on-the-job hazards, collectively deserve a proper day off. Walmart noted this in its announcement. And Dick’s Sporting Goods, which also announced Thanksgiving Day closures, also extended its coronavirus pay increases through the end of the year, noting, “We will continue to do all we can to support [our employees] and show our gratitude.”
That’s the question asked by the New York Times, which posits that as many as one in four malls in the U.S. could close entirely as the department store anchor-tenant model teeters.
According to industry researcher Deborah Weinswig, the article says, “the malls that are able to withstand the current turmoil will be healthier — better tenants, more inviting and occupied — but … about 25 percent of the country’s nearly 1,200 malls” could close entirely.
Real estate experts see opportunity in the closing and not just dread: malls can be reinvented, as housing, offices, local markets and other concepts. But they may not be the shopping centers that defined late-twentieth-century American culture.
From the Wall Street Journal, a prediction that shuttered brick-and-mortar stores will be reborn as ecommerce distribution centers. Early indications are interesting: no foot traffic, but an increase jobs, as the retailers need more hands to pick, pack and ship than to staff cash registers.
The New York Times reported on small businesses weathering lockdowns in America, and how an increasing number of them may choose not to reopen, due to both economic and physical complexities.
Stores weathering the pandemic are having a hard time seeing a viable future, especially when governments reopen stores, only to close again—a situation that may persist for months.
Some owners also find the constant changes in requirements difficult to follow, as guidelines for safety are rapidly evolving. This is to be expected, but that doesn’t mean it’s easy.
From the article: “Many small businesses are also finding it onerous keep up with constantly changing local guidelines, while others are deciding that no matter what their local officials say, it just is not safe to keep going. Gabriel Gordon, the owner of a tiny but popular barbecue restaurant in Seal Beach, Calif., decided to close permanently after studying the restaurant’s layout. He had determined that the kitchen would never be safe for multiple staff members to occupy at once while the virus was still active in the area.”
This action is an early indicator of predictions like this one, from April, that big stores will get bigger as mom-and-pop stores struggle to adapt. Local establishments are hoping that government assistance and clarity will help them survive.
After Shopping enjoyed this interesting list of retail statistics in Forbes, which also includes an upbeat look at how the industry is successfully evolving in our unique commercial environment.
“Retailers are doing things they never thought they would do, like deliver products curbside,” the article notes, adding that curbside orders have tripled since the pandemic began, with more than half of shoppers saying they’d like to keep shopping this way long-term.
The Financial Times recently posted an excellent exploration of L’Oreal’s digital future, and the changes the company has seen due to the pandemic.
“In ecommerce,” said Chief Digital Officer Lubomira Rochet, “we achieved in eight weeks what it would have otherwise taken us three years to do.”
The cosmetics company had already embraced digital tactics for marketing and product exploration that replicate the experience of visiting a store’s make-up counter. Now, it is forecasting a world where 50% of its sales come from ecommerce, up from 20%, and a large majority of customer contacts occur online.
Struggling vitamin and nutrition retailer GNC announced a chapter 11 bankruptcy filing, with plans to close nearly 1200 of its 5800 retail locations. The company cited covid-19–related store closings as a main driver of the filing.
GNC did secure $130 million in financing to endure the pandemic and successfully emerge from the bankruptcy process.
Something to look out for in the near term in shopping is a glut of merchandise in non-essential segments. Fashion, for one, will be dealing with high inventory levels as stores reopen, particularly at fast fashion chains like H&M. This could mean good deals for shoppers, as well as headaches for sellers, who need to clear out merchandise and make room for upcoming stock, presuming supply chain disruptions have been kept to a minimum.
The Wall Street Journal speculates that retailers might see “years of depressed profit margins” as they try and reset after the pandemic—and that savvy shoppers could snap up some great deals this summer.
Modern Retail has begun a series on store reopenings post-lockdown, starting with today’s piece on what stores will look like this summer.
Their takeaway: expect carefully thought-out experiences that begin before shoppers even get to the door. Gone are the days of wandering into a store to browse. Instead, we’ll see more queuing, curbside pickup, and lots of communication about how and why. We’ll see an increased reliance on technology from introduction to post-purchase. And, more often than not, employees will be wearing masks.
There’s a lot more detail in the piece, which is very much worth the read. (h/t LeanLuxe)
While this site is focusing on retail, it would be impossible to ignore the powerful surge of ecommerce that is occurring this spring, from Instacart shoppers to food delivery to Amazon’s getting so busy it had to slow down Prime shipping times.
Digital Commerce 360 published an interesting set of ecommerce charts and data today showing the pandemic’s impact. Online grocery in particular has skyrocketed, but all of ecommerce has seen a huge boost, giving momentum to a retail industry that has seen 11 noteworthy bankruptcies this year, six since the crisis began.