3 COVID-induced retail transformations that will live on post-pandemic

Even before COVID-19 forced retailers to embrace a “new normal,” the retail landscape was changing.

Retailers were already evolving to better understand their customers’ preferred ways of shopping — the pandemic just encouraged them to move more quickly and to embrace alternate channels of commerce.

Here are a few ways retailers originally introduced to keep customers coming, but are likely to continue because of their benefits.


Transforming stores from customer-side to supply-side

Female Inventory Manager Shows Digital Tablet Information to a Worker Holding Cardboard Box, They Talk and Do Work. In the Background Stock of Parcels with Products Ready for Shipment.


Early on in the pandemic, retail was hit with a lockdown that effectively closed storefronts.

Innovative brick and mortars transformed from being customer touchpoint locations to becoming crucial nodes in the supply system.

Temporarily closed sites became mini warehouses that could deliver products ordered online or offering click-and-collect services.

Others tested automated fulfillment centers at the back of existing stores. That flexibility made store space more productive, something retailers continue to assess.


Accelerated ecommerce growth

male bike/sport shop at laptop working on ecommerce accelerated by covid related retail transformation


With mandated store closings of physical locations, retailers focused on their ecommerce channels.

For example, fewer than one in five Western European consumers had purchased groceries online before the pandemic.

Although grocery stores were considered essential businesses and allowed to remain open during lockdown, hours of operation were reduced due primarily to low staffing, and customers felt safer ordering online and either picking up in person or having packages delivered.

For Western Europe, the impact was dramatic: According to the consultancy Alix Partners, the pandemic may have advanced those countries four to five years into the future.

A significant number of those customers who had never bought food or groceries online are likely to continue doing so, which in turn led retailers to implement digital payment methods.


Contactless payments

person pays for coffee with card app on phone | covid related retail transformation

Photo by cottonbro on Pexels


In the past 15 months, the use of cash declined, due to concerns it was a means of spreading COVID-19 and other germs.

The surge in the demand for contactless payment led to outstanding performances for major companies. The offering is shifting from being “nice-to-have” to being essential.

During the past few years, U.S. shoppers have gradually decreased their use of cash.

In 2019, Experian reported that 1-in-10 millennials used their digital wallet for every purchase.

There has already been a notable decrease in cash usage over the past few years.

And nearly a third of U.S. adults said they typically make no purchase using cash during a week, according to a study by Pew Research Center.

The Forrester/NRF State of Retail Payments study, released last August, found 67 percent of retailers surveyed now accept some type of no-touch payment.

That figure includes 58 percent accepting contactless cards that can be waved past a card reader or tapped on the reader, up from 40 percent in 2019.

In addition, 56 percent take digital wallet payments on mobile phones, an increase from 44 percent.

The corona virus caused unprecedented disruption, innovative and flexible retailers created ways to continue to provide customers the products and services they needed in ways that were accessible.

They learned how to successfully navigate through difficult circumstances while still accommodating customer requests.

Those types of actions build trust, which is an essential part of getting through any crisis.

View blog post on RPI Blog.