The changes we are going to see are numerous and far ranging. But much of the commentary is conceptual, intellectual, theory based. But what about ‘specifics’ – hard hitting stuff, winners and losers? Simon Fonteyn gets down to business…
COVID-19 has decimated the retail landscape, with retailers in shopping centres some of the hardest hit. However, it is not the first time the industry has faced a crisis, and therefore, we can look to the past to glean insights into the trajectory of the recovery of Australian retail as well as the unique challenges and opportunities created by this pandemic.
Massive shift to online shopping
During the SARS epidemic of 2003 and the GFC (2008-09), there was a seismic shift in online shopping across most retail categories. According to a study conducted during the GFC, 91% of online buyers said they were more comfortable buying online compared to in store. Online shopping increased consumer confidence and security as well as allowing shoppers to compare prices more easily, helping them save money. Prior to COVID-19 as at February 2020 online retail was sitting at 9.4% of total retail sales (Source:NAB Online Retail Index April 2020). Globally, e-commerce sales will increase to 16% of all sales in 2020, representing an increase of 19% and may become the new normal.