Table of Contents
Executive Summary
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- Analyst perspective: COVID-19 and Retail & eCommerce
- Key takeaways
- Short-, medium- and longer-term impacts
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- Figure 1: Short-, medium- and longer-term impact of COVID-19 on Retail and Ecommerce, June 2020
- Market performance and sales forecast
- Retail industry in a healthy position prior to COVID-19
- COVID-19 has completely rewritten the narrative
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- Figure 2: Total US retail sales, at current prices, 2015-25
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- Figure 3: Total US retail ecommerce sales and forecast, at current prices, 2015-25
- The US is in a recession
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- Figure 4: Unemployment, January 2007-May 2020
- Looking at the big picture
- In-store environment
- eCommerce considerations
- Key opportunities
- Remaining nimble and building flexible contingency plans
- Understanding consumer sentiment and behaviors
- Adding value moving forward
Consumer Impact
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- What consumers want right now
- Consumers’ worries remain high
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- Figure 5: COVID-19 exposure and life disruption concern, June 25-July 7, 2020
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- Figure 6: Concerns about exposure to COVID-19 and lifestyle disruption, by gender and age, June 25-July 7, 2020
- Behavioral changes in light of CDC recommendations and the need to feel prepared
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- Figure 7: Coronavirus behaviors, April-June 2020
- Where and how consumers shop is changing
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- Figure 8: Mentions of #supportsmallbusiness and #shoplocal on Instagram and Twitter, March 1-June 18, 2020
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- Figure 9: Select Coronavirus behaviors, by gender and age, June 25-July 7, 2020
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- Figure 10: Shopping changes after COVID-19 outbreak, by generation, April 2020
- Consumers shift purchasing to essential goods
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- Figure 11: Spending habits, June 25-July 7, 2020
- Consumers begin to rein in unnecessary spending, despite a majority still feeling financially secure
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- Figure 12: Unemployment and underemployment, January 2007-May 2020
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- Figure 13: Financial health, by household income, June 25-July 7, 2020
- “We’re in this together,” but not in the same way
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- Figure 14: Consumer reactions to COVID-19, April 2020
- Everything worriers
- Health worriers
- Financial worriers
- Non-worriers
Industry Impact
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- Retail industry in a healthy position prior to COVID-19
- This picture has now changed dramatically
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- Figure 15: Total US retail sales, at current prices, 2015-25
- Figure 16: Total US retail ecommerce sales and forecast, at current prices, 2015-25
- Impact of the recession
- Everything has changed
- Retailers must quickly pivot to remain relevant
- Immediate action: shift focus online
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- Figure 17: Pier 1 website screenshot
- Figure 18: CVS Facebook post
- Immediate action: shut down entirely
- Looking forward: reinvent the shopping experience
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- Figure 19: How retailers are reinventing the consumer shopping experience
- Looking forward: Rethink communications plans
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- Figure 20: Everlane “welcome back” post
- Figure 21: Adore Me and Apple Instagram Posts
- Expanding offerings through partnerships and acquisitions
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- Figure 22: Retailer at-home examples
- Changing business models
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- Figure 23: Joann Fabrics and Crafts Instagram post
- Rethinking holidays and major sales periods
Sector-specific Impact
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- The race for survival
- Essential retailers should endure the brunt of the pandemic
- Non-essential retailers face significant challenges
- Spotlight on grocery
- Spotlight on apparel
- Pandemic threatens to temper interest in the circular economy, but resale could be a bright spot
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- Figure 24: Rent the Runway post to customers
- Figure 25: Poshmark “Virtual Posh N Coffee” post
- Spotlight on beauty
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- Figure 26: Maybelline customer email
Changes Stemming from the Short Term
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- Figure 27: Short-, medium- and longer-term impact of COVID-19 on Retail and Ecommerce, June 2020
- What consumers want – then and now
- The ups and downs of the sales cycle
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- Figure 28: US retail sales in May compared to last month and last year, June 2020
- A phased return to the next normal
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- Figure 29: Shopping changes due to COVID-19, April 2020
- Retail challenges force change
- Seeing the opportunities
- Winning new customers
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- Figure 30: Attitudes toward retailers’ charitable efforts, December 2019 and April 2019
- Figure 31: Everlane human collection Instagram post
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- Figure 32: Rent the Runway Instagram post
- Getting local
- Holidays look different
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- Figure 33: Jack in the Box Facebook post
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Managing Change in the Medium Term
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- Figure 34: Short-, medium- and longer-term impact of COVID-19 on Retail and Ecommerce, June 2020
- What consumers want
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- Figure 35: Important factors that influence retailer preference, April 2020
- Hybrid of consumer behaviors and sentiments
- Retail challenges continue
- Seeing the opportunities
- Promoting “clean” shopping
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- Figure 36: Target COVID-19 business update
- Creating a link to wellness
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- Figure 37: Parachute Home design tips Instagram post
- Getting outside of the store, literally
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- Figure 38: Outdoor voices digital interactions post
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- Figure 39: Music Box Movie Theater and Carpe Librum partnership post
- Preparing for the holidays/key retail time periods
- Preparing for Back-to-School
- Preparing for winter holiday shopping
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Managing Change in the Longer Term
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- Figure 40: Short-, medium- and longer-term impact of COVID-19 on Retail and Ecommerce, June 2020
- What consumers will want
- A time for rebuilding
- Longer-term impacts of COVID-19 will continue to be realized
- The fallout
- Desire for wellness leads to clean shopping
- Convenience drives ecommerce
- Technology supports the demand for contactless fulfillment
- Value-seeking shoppers will respond to retailers’ heavy discounting
- Consumers could see more value in the convenience of subscriptions
- Prioritizing sustainability over cleanliness
- Heightened focus on mental and physical wellbeing across retailers
- Consumers will be quicker to adopt technology that helps them shop safely
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Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Consumer survey data
- Consumer qualitative research
- Abbreviations and terms
- Abbreviations
- Terms
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