Webinar Recap: What Now? Marketing Plan for Retailers Transitioning Back to Physical Stores After COVID-19
In a recent webinar hosted with partner Uberall, we took a look at the transition back to stores and how a variety of retailers are handling that difficult transition. Couldn’t attend the webinar? Here, we’ll recap some of the highlights and set guidelines that will enable you to return to your business after this crisis.
The changes to the economy have been immense, with potential short-term and long-term impacts. However, our experts, including Greg Sterling, VP of Market Insights at Uberall, and Trey Porter, Senior Account Supervisor at Adlucent, have provided some guidance for businesses to create a plan to return to their regular operations.
COVID-19 is an unprecedented event. It has impacted almost every sector of society globally. People from all walks of life and businesses in all industries have faced substantial impact from this challenge.
In the United States alone, there have been nearly 37 million unemployment claims. Job and income stability are less certain than ever in many sectors, and health and safety are of paramount concern for both workers and customers. Consumer confidence is one of the most critical elements that stores will have to manage as stores reopen.
Major Impacts, Which May Be Temporary
Among the many impacts of COVID-19, many people have faced immediate financial repercussions. Consider:
85% of people have seen an effect on personal income
83% of those who were laid off or had hours/salary reduced expect to be rehired or reinstated in less than six months
The loss of income could prove substantial and could continue to impact retailers. Yet, many people expect to return to business as usual in the coming months, which could cause shopping habits to undergo a shift toward the old normal from before the pandemic.
Pharmacies and other health/personal care stores: -15.2%
Big-box (general merchandise) stores: -13.8%
Electronics and appliance stores: -64.8%
Sports, music and other hobby stores: -48.7%
Furniture stores: -66.3%
Clothing and accessories stores: -89.3%
Online retailers: +8.4% (month over month)
These changes in sales suggest that many customers are putting off non-essential spending until they can improve their overall financial stability and have a better idea of what to expect in the future or until the economy, as a whole, returns to some semblance of normal. On the other hand, grocery spending remains higher, perhaps partly because many people are choosing to eat at home instead of going out.
Understanding Customer Psychology
Customer psychology has shifted in light of the pandemic. Customers have dealt with unprecedented changes and shifts that have impacted their shifting habits over the past several months. Five clear psychographic consumer segments have slowly started to emerge post-pandemic to continue guiding consumer spending.
Get to normal. Many customers are eager to get back to normal as soon as possible. They want to emerge back into the world and go back to their usual habits, including their usual spending habits, sooner rather than later.
Cautiously extravagant. After weeks of avoiding excess spending or cutting back–not to mention the requirements of social distancing or shelter-in-place measures, many customers are looking for ways to be “cautiously extravagant.” They’re splurging in areas that are important to them while still holding back full spending.
Stay frugal. While many customers are eager to get back to normal as quickly as possible, some aren’t sure that they’re ready to go full-force. As a result, they’re remaining frugal: sticking with store brands and neglecting to spend in some non-essential areas.
Keep cutting. Some consumers are still cutting out unnecessary expenses. As job loss drags on for some Americans, they’re looking for ways to reduce their costs.
Back with a bang.While some customers remain frugal, others are coming “back with a bang,” substantially increasing their spending in some areas or making large purchases before returning to their former spending patterns.
It’s the Ecommerce
While the economy has had a substantial impact on many spending behaviors, the COVID-19 crisis hasn’t just impacted the way consumers are spending in general. It’s also created a shift in sentiment related to online shopping and ecommerce.
Online Spending: Double, Triple-Digit Growth
Online spending has grown substantially. There was a 49% increase in daily ecommerce sales from March to April, and order volume for online grocery retailers grew 210% YoY (Ratuken, April). Online food sales have surged 183% YoY (NetElixir, April). First time online buyers have increased across all sub-verticals. Many consumers have shifted to online retail purchases instead of in-store purchases, and online retailers reap the benefits.
BOPIS Grew Dramatically YoY
Buy-online-pick-up-in-store (BOPIS) orders surged 208% YoY in April. Many consumers are likely to continue these behaviors for the foreseeable future, whether they’re choosing to continue to engage in that type of shopping to avoid contact with people or to save time.
Permanent Ecommerce Gains
According to McKinsey, retail executives predict a 6% to 13% increase in online penetration compared with pre-pandemic levels. While many consumers will go back to normal shopping behaviors over time, others will make a more permanent shift to those online shopping behaviors.
Will They Come Back?
The majority of consumers are not yet comfortable in stores. They’ve paid attention to current recommendations, and they’re aware that normal shopping behaviors or a hasty return to normal could cause a resurgence in COVID-19 cases. That doesn’t mean, however, that consumers are going to stop spending long-term. They’re likely to start re-emerging as they get a better feel for how their behaviors are expected to impact disease spread, or they get a better feel for how their spending habits will need to change long-term in response to the pandemic. According to smartphone data, there is a great deal of latent desire to shop, which indicates that many consumers will start to return to their normal shopping behaviors as soon as they feel it’s safe.
The New Normal: Implications for Retailers
Retailers across the United States should expect some dramatic changes in the wake of the COVID-19 crisis, many of which will have a continuing impact on their businesses reaching well into the future. Consider:
A large percentage of US malls could close in the next 2-3 years.
Stores may become showrooms and return centers, with more people taking care of their shopping needs online.
People will conduct more online research and visit stores in person less often.
Contactless payments are likely to dominate.
We’ll see more technology and fewer associates in many stores, reducing direct person-to-person contact in retail environments.
Brands are likely to diversify aggressively into DTC (direct-to-consumer)
Many brands are also finding their own ways to handle the surge of changes related to COVID-19. Take a look at how some of these popular brands are dealing with new requirements.
Apple: Temperature Checks at the Door
Apple has instituted strict measures to keep customers and employees as safe as possible.
“Find a Store” indicates which stores are open
Shoppers in the store are limited
Masks are required for employees and customers
Temperature checks at the door identify any potentially ill customers.
Multiple “deep cleanings” throughout the day
Curbside pick-up and drop-off options allow customers to have less contact with employees and avoid coming into the store
Best Buy: Shop by Appointment
At Best Buy, measures remain in place to protect customers’ safety, and many of those changes are likely to continue.
In-store consultations by appointment only (phone, online, app)
Each customer gets a dedicated employee “chaperone” who wipes down products and assists with purchasing
All employees wear gloves and masks
Sneeze guards at registers
Wipes and hand sanitizer are readily available throughout the store
UPS stores, CVS pharmacies, Advance Auto Parts, and other independent stores in your area have worked out a delivery option that lets customers avoid contact. They deliver the package to the location of the customer’s choice, let them know when it arrives, and arrange for pick-up at a time that works for them.
Macy’s: Focus On Customer Safety
Like many other stores, Macy’s has a strong focus on customer safety as businesses around the country start to reopen. Options include:
Social distancing in the store
Masks and gloves on employees
No “close contact” services
Plexiglass shields at checkout
Nordstrom: Range of Innovations
Nordstrom is taking customer service to the next level, offering a range of innovations that have helped advance consumer safety.
100% contactless payments
Drive-through order pick-up
Virtual styling appointments
Functional or Friction-Filled?
While these changes have made it easier for many customers to continue shopping, increasing overall customer satisfaction and allowing businesses to remain operational despite the challenges, many companies are still asking questions. Foremost: how long will this “transition” be? Can businesses expect these measures to last for a year? Two? How much should they invest in a secure transition, and what protocols are likely to stick around long after the pandemic ends? Some of the highlights that are likely to remain important:
Stores will need to be highly customer-centric: they must focus on the needs and desires of customers
Stores must attract customers with service, experiences, incentives, and inventory
Businesses must keep in mind the continuing need for employee and customer safety while accommodating customers who are eager to return to normal sooner rather than later, as well as those who might be unwilling to adhere to some of the safety protocols.
Customers Want to Know Before They Go
Retailers need to continue making these transitions, and they must also inform customers of what to expect before they visit the store. Many consumers will be cautious about how they spend and where they go since they want to minimize the risk of infection. Some will be reluctant to resume their old activities and may continue with new online behaviors, especially if they share a household with someone who is high-risk. Consumers need assurance that businesses and retailers have clear procedures to protect their health and safety. They want to know before they go what the experience will be like, from whether to wear a mask to how salespeople and other employees will interact with them.
Useful Tools for Identifying Trends in Demand
Consumer needs are changing rapidly. Search queries and trending categories can give a clear picture of what your customers are looking for and what they want to know. You can also break those insights down by geographic location to see what your customers, specifically, need in the wake of these challenges.
In April, Google announced that products in Google Shopping would be free. It’s now live in the US, allowing those who have a GMC account and product feed to:
Opt-in to “Surfaces across Google”
In-store product inventory a separate feed; opt-in to “Local surfaces across Google”
Optimization best practices (e.g., product titles, pricing)
Google My Business
Fully optimize profile
Update hours (again)
Use COVID-19 Posts or Google Posts (mutually exclusive)
Google Posts: Offer and product posts to drive traffic to site and ecommerce
Photos and video (communicate the new experience)
Business attributes: curbside pick-up, delivery, etc.
Reviews and Q&A (monitor, seed [FAQs] and respond)
By taking these steps, you can ensure that your business information is up to date and that customers know what to expect when they visit your location.
Facebook: Update, Communicate
Social media is a crucial communication channel, now more than ever. With many consumers researching before they go out, it’s essential to keep your social media profiles updated as much as possible. You can use social media to:
As with lockdown, share updates, hours changes, opening or safety protocols with customers and followers
Make bulk changes in Store Locations Manager
Facebook and Instagram Shops
Facebook Shops enables online stores (SMB) on both Facebook and Instagram. It’s free and allows checkout on the site or in the app. On Facebook, Shops has partnered with major commerce platforms, including Shopify, BigCommerce, WooCommerce, and more. Instagram Shops is a new commerce experience and allows product browsing from Instagram Explore, which provides customers with more shopping opportunities and choices.
Similar to Google My Business, you should:
Optimize your profile
Update your business’s hours
Use any COVID-19 post options
Use photos and videos to communicate the new shopping experience
Offer information about your business’s current attributes in light of the pandemic
Monitor and respond to reviews
Provide answers to FAQs related to your business
Yelp has released a long list of COVID-19 features. It includes:
COVID banners for business pages to communicate critical information
New Business Highlights with COVID-friendly categories, such as curbside pick-up, gift cards, and remote services. These are icons that appear on the business profile.
Yelp for business improved: The company introduced a new version of Yelp for Business, with a better UI and more data for business owners.
Reviews: It’s important to pay close attention to those reviews and respond to them as needed, especially as your business reopens.
What Might Reactivation Look Like?
As you prepare to reopen your stores, it’s important to keep in mind that your business considerations could be dramatically different from the concerns of many others.
Turn back on the campaigns that were paused
Aim to activate customer-centric messaging on store safety precautions
Explore new opportunities to support stores and omni-conversions
Set up options for contactless payment (Google Pay, Apple Pay)
As you transition back to brick-and-mortar, make sure you’re asking the right questions for your business. You don’t want to disappoint customers, and you should deliver on their expectations as much as possible. Ask:
Are stores going to be reopened on a rolling basis by region?
Will consumers feel comfortable visiting stores?
Are you supporting curbside pick-up and/or BOPIS?
Even with stores reopening, it’s still important to keep an eye on the online fundamentals. By enhancing the online shopping experience, you can not only raise sales to keep customers comfortable but also increase interest in the services and products you’re offering in-store. Your online fundamentals must include:
A high-quality website experience
Accurate local store inventory
A merchant-hosted local storefront
Email and text confirmations so that customers have confidence that their shopping has gone through properly
Updated refresh cadence
Stock status, price, and availability are up to date
In addition to your website, you want your customers’ social experience with your business to continue to show the high degree of excellence they’ve come to expect from your business. Customers have interacted with your social media more than ever during this time, and they are primed to continue those interactions. You want to supply:
Shoppable posts and Shops digital storefront
Customer service via messenger
Accurate and high-quality product feeds
Speed is everything! You have only seconds for your website to provide what customers are looking for before moving on to a different provider. You should also take steps to offer seamless app integration so customers can use your app for shopping.
Near-Term: Curbside Pick-up
You’ll want to include curbside pick-up as part of your paid search campaign to let customers know that you’re still offering this valuable service. Add “curbside pick-up” language across your campaign creatives, and place those messages on your landing pages. You’ll also want to pin “curbside” language to your headline or to description line 1 to make this language more visible across your campaigns and ensure that customers can access it.
Preparing Your Business
As you reopen, you should take several critical steps:
Update GMB hours and add a COVID-19 post to your Google My Business Listing
Launch Local Inventory Ads campaigns to reactivate Store pick-up annotations
Add “curbside pick-up” messaging to landing pages
Add business or product-specific COVID-19 related info on text ads
Speak to your company policy on store pick-up, safety precautions, and additional updates
Summary of Action Plan for Retailers
As you’re preparing to reopen your business, make sure you follow these key steps to make your reopening as effective as possible.
Update hours and relevant info on business listings across online listings including Google, Bing, Yelp, Facebook and more
Activate paid campaigns for open locations, utilizing curbside pick-up annotations and local inventory ads
Communicate store safety precautions and other relevant messaging, so customers know what to expect
Continue ecommerce marketing to capture customers not yet comfortable going in-store, including search and shoppable posts on social
COVID-19 has created unprecedented transformation across many businesses and multiple industries. Chances are, your business is taking many precautions during this time to ensure that your customers and employees stay safe while trying to get your doors open and customers back in your physical location. Create a solid action plan to market your business in the aftermath of the pandemic, providing your customers with an updated look at what they can expect when they connect with your business. And, keep them informed as you continue to adapt throughout these challenging times. If your large retail or ecommerce brand is looking for support as you adjust your marketing strategies during this time, Adlucent ishere to help.
Adlucent is the performance marketing agency that proves outperformance has no limit. Powered by our purpose-built platform, Deep Search™, Adlucent unifies the best of human and machine for a scientific approach to marketing. We work transparently in partnership with B2C and B2B retailers and brands to create custom, predictive programs that drive ever-better outcomes. Our services include paid search, shopping, social, Amazon, display media, video, performance creative, consulting, and measurement. Headquartered in Austin, Texas, Adlucent is part of Advantage Solutions and ranked one of the top marketing companies in the U.S. by AdAge.