July 17th, 2020 | Sterling
Covid-19 Retail Insights with
Matthew Shay, President and CEO, NRF
Better Together: Leading Through Crisis with Matthew Shay, President and CEO of National Retail Federation
As the Covid-19 pandemic continues to evolve, retailers around the globe are shifting their business models and adapting to the new normal. This includes using technology and AI to continue serving their customers while protecting the health, safety, and well-being of their employees.
While it’s still not clear the total impact Covid-19 will have on retail companies, the ability to be nimble and pivot quickly sets a precedent and provides a blueprint for companies to adapt and fill the needs of customers in these challenging times.
So, what can retailers around the world do to meet the increasing customer needs all the while keeping employees and customers safe?
Sterling invited Matthew Shay, president and CEO of National Retail Federation to weigh in on the impact of Covid-19 on the retail industry, how retailers are effectively leading through this crisis, the steps retailers are taking amid the Covid-19 pandemic as the situation continues to evolve, and the encouraging future of retail.
1. To date, what effects of Covid-19 on retail have been most surprising or unexpected to you?
Matt: It’s never surprising when retailers step up to serve their communities during times of crisis, and their dedication and impact are always inspiring. Retailers of all sizes have been serving customers, supporting communities and powering our economy throughout the pandemic. Many of these retailers never closed their doors and have experienced what it’s like to be on the leading edge of doing business in the “new normal.”
Retailers created and implemented new operating protocols and procedures that successfully kept their teams and customers safe while maintaining the same products and services operating their stores, fulfillment and distribution centers, and supply chains safely.
As we imagine the future of retail and commerce across the broader economy, the experience of these “economic first responders” will inform how we broaden economic activity and put the rest of America back to work.
2. Are there any particular trends or aftereffects you expect to last beyond the immediate crisis and into “the new normal”?
Matt: Covid-19 has accelerated trends we have seen over the past few years as retailers reimagine the customer experience, blending online and offline channels. Even prior to the coronavirus, consumers had embraced the change. According to a recent IBM survey, the percent of consumers saying they use “buy online, pickup in store” has more than quadrupled since 2014, and we have continued to see more shoppers using BOPIS or curbside pickup since the start of the pandemic.
Many retailers today are emphasizing e-commerce offerings and curbside pickup options to serve customers safely. Spending an extended period of time at home will push consumers to take advantage of these offerings. Post-pandemic, we expect to see more consumers comfortable with ordering products and services online.
3. Which companies or subsets so far have been able to adapt most successfully? For those that are having a tougher time navigating the crisis, what advice do you have for them as the country and economy shift to a new phase?
Matt: While some retailers have seen losses as consumers pull back on discretionary purchases, other retailers are benefitting from stable revenues as they keep up with the demand for everyday goods and services. Businesses that have been forced to close their doors have suffered heavy losses, but we anticipate many of these retailers will see a sharp recovery as consumers start shopping in stores again. Retailers that were forced to close temporarily are learning from those that remained open and the new operating protocols and procedures put in place to keep their teams and customers safe.
Success in retail has always been about providing the right product at the right price at the right time and creating a great shopping experience. This will continue to be the case and the best retailers will outperform. As we move into an economic environment where some consumers’ finances are under pressure, we may see more price sensitivity. Those retailers that can offer the best value will have an advantage.
4. When it comes to recruiting and employment screening — particularly amid urging hiring as well as the inevitable ramping up that is to come — how do retailers strengthen their hiring programs to successfully address potential issues surrounding employee and customer safety?
Matt: Retailers’ top priority is the safety of their employees, customers, and store and facility environments. Over the past few months, retailers have been on the front lines of this pandemic and have successfully operationalized social distancing mandates to protect employees and customers and demonstrated that stores and other facilities can be operated safely.
NRF has convened hundreds of retail industry leaders to launch an initiative called Operation Open Doors, which provides guidelines and resources to help retailers navigate gradual reopening. The recommendations focus on four critical areas: health and safety; people and personnel; logistics and supply chain; and litigation and liability.
Operation Open Doors provides a road map for retailers in a single, comprehensive resource delivered digitally and with regular updates and real-time adaptation. One of the biggest takeaways from this initiative so far is that recovery will happen gradually and will vary among states, regions and cities. Every strategy, rule and guideline must comply locally and be tailored to the local shopper and local health conditions. What works in Vermont won’t work in South Carolina. That said, retailers need consistent guidelines across all levels of government to operate safely and successfully.
5. For the future of retail, what are you most optimistic about?
Matt: Recent surveys show that a vast majority (94%) of customers understand and expect there will be new safety requirements in place as they return to shopping in stores. Customers are mostly looking for common-sense health measures like providing hand sanitizer or hand-washing stations at store entrances, regular deep cleans, and social distancing in stores.
The good news is that retailers are one step ahead. Businesses across the country are implementing protocols like those described above, and in many cases going above and beyond local and federal sanitation guidelines to protect shoppers and employees as they reopen.
We also expect technologies like contactless payment — or any technology that allows for reduced contact and greater social distance — to continue to grow in a post-COVID retail environment.
6. Looking back at all the conversations you’ve had with retail industry leaders since the crisis began, what’s the best piece of advice or insight you’ve received?
Matt: One of my favorite pieces of advice came from Mike George, chairman of the NRF Board and president and CEO of Qurate Retail, Inc. He said that while you may not know exactly what the future brings, you must believe in the direction you’re headed. None of us has a crystal ball to see into the future of these uncertain times, but we must have the right culture, values, and leadership in place to ensure we’re ready to adapt to whatever it holds.
Updates on Covid-19 and policies are changing daily so it’s imperative to stay up to date as much as possible. Be sure to check out the NRF Coronavirus Resource Page to stay caught up on the latest news and updates and learn how Sterling can support your return to work plan while matching your current business needs.
As the mantra “we’re all in this together” continues to hold true, it’s important to understand that the retail industry can play a significant role in lessening the setbacks of Covid-19.
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