How Has Covid-19 Changed Retail?

By Adina Deutsch, Intern

From the overnight lifestyle changes to the decrease in financial security, consumers’ shopping habits have changed drastically from the onset of COVID-19. The changes in income and safety protocols have led consumers to adapt to new personal circumstances, causing all retailers to feel the pandemic’s effects too.

While some retailers found new ways to innovate and provide a new shopping experience for their customers, others have suffered unrecoverable financial loses. 

Mass Retailers Stay Afloat

Coronavirus caused mass retailers such as Target and Walmart to sell out of all sanitary, cleaning, and household goods. While this may seem beneficial for the national retailers, it poses a problem as they source up to 30% of their goods from China.[1] Chinese distributors have dramatically slowed down due to the virus and caused delays throughout the entire supply chain.

However, big-box stores have been profiting from the virus overall. Customers have found comfort relying on these stores for essential items during these unpredictable times. By providing groceries, sanitary products, and other essential goods, mass retailers have adjusted their inventories to new consumer demands and have worked to provide a safe shopping environment according to health protocols. Luckily, employees working in these mass retailers have kept their jobs during these times, while department stores, luxury stores, and other retailers had to cut employees to save money.

Department Stores Struggle

Department store retailers have not had such luck adjusting to the effects of COVID-19. As consumer spending took a downturn, so did sales on nonessential goods such as clothing, accessories, and more. After years of financial uncertainty, JC Penney filed for bankruptcy in May, followed by Century 21 in September. In fact, department store retailers such as Macy’s and Kohl’s have lost an estimated $12.3 billion over the course of the pandemic.[2]

Taking a phased approach to reopening, other department stores have reduced store capacities, implemented glass dividers at checkout, and even hold any merchandise that has been tried on for 24 hours. Through retailer websites and mobile apps, customers are able to shop with curbside pickup, contactless payment, and increased sanitation in-store.

Threats to Luxury

Luxury retailers such as Neiman Marcus, Lord & Taylor, and Saks 5th Avenue have faced the biggest consequences from COVID-19. With consumer spending geared towards essentials, health, and safety, frivolous shopping has taken a halt. Neiman Marcus filed bankruptcy in May, while Lord & Taylor filed for bankruptcy and was sold to French retailer Le Tote in August. Even one of the oldest retailers, Brooks Brothers, filed for bankruptcy this July due to financial restraints and company losses in the pandemic.

Sales for the Spring 2020 season were 70% lower than last year’s due to the drastic shift in consumer spending.[3] In attempt to combat these losses, luxury retailers have heightened their stress on in-store sanitation, e-Commerce platforms, and online sales. Brands are also maximizing short-term operations and financial strength through moderate promotions on merchandise. As for the future of luxury goods, it is increasingly important for brands to focus on maximizing supply chain operations to reduce costs and improve profits.


As to be expected, e-Commerce has thrived due to COVID-19. Even as stay-at-home order left, consumers still rely on online platforms to purchase all goods from groceries to household products. With the ease of delivery services and mobile apps for retailers, consumers can purchase anything they need with the click of a button. In specific, American e-Commerce spending increased 44.5% in the second quarter of 2020, accelerating the shift to online by 5 years. [4]

Retailers can use these online platforms to gather consumer data and learn future courses of action as the pandemic progresses. Using data-driven insights, retailers can navigate a new way to renew their relationship with consumers. Brick-and-mortars can translate to e-Commerce with a software-as-a-service, or SaaS, platform to increase sales and stay in competition. Strengthening online presence is now more important that ever. 

How Enhanced Retail Solutions Can Help

If you don’t already have insight into your retail data, now is the time to begin. Enhanced Retail Solutions offers fully automated data retrieval, validation, scrubbing, and most importantly, the interpretation needed to take action. Tracking your sales data can lead to improved inventory turnover, sales, and overall profits.

At ERS, we can help you improve your decision making with fresh insight by transforming EDI 852, retail portal data, and other reports emailed from retailer buyers and planners into actionable information. We’ll gather all your data and provide seamless reporting, analytics and forecasts to give you the direction needed during these unprecedented times.

To learn more about Enhanced Retail Solutions and how it can help your business, click here.





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