Even if the near future seems uncertain for U.S. consumers and retailers, Covid-19 experts agree on at least one thing: the pandemic is far from over. We must expect that the number of cases will rise and fall again, although hopefully much weaker in strength and more regionally limited. But while the first outbreak came out of nowhere, retailers now have the time to take appropriate precautions, offering consumers safe and meaningful experiences across all channels.
South Korea has been a great source of inspiration for how to handle a second wave. So far, the government in Seoul is steering the country through the pandemic without any area-wide lockdowns and, despite some setbacks, shops and bars remain open and the country is doing relatively well. The greatest lesson we can learn by looking at South Korea is that retailers will especially benefit from well-integrated in-store and e-commerce experiences. As the rebound approaches, here are five successful strategies from South Korea that retailers here in the U.S. should consider.
1. Increase visitor flows through exclusive marketing pushes
As soon as the situation stabilized in South Korea, retailers shifted their focus to driving sales again. By hosting exclusive in-store events for a few select customers, shoppers were able to enjoy a pleasant experience in a controlled environment where there were never too many people in the stores at the same time. Retailers also began running in-store discount campaigns on specific days and inviting regular customers to shopping events that were usually reserved for VIP consumers to drive online consumers to physical stores. As brick-and-mortar stores begin to re-open retailers in the U.S. should be sure to provide exclusive incentives to drive consumers to shop in-store, while stressing changes made to increase the safety of the in-store channel.
2. Renew brand loyalty with interactive shopper experiences
Whether consumers are shopping online or in-store, positive shopping experiences are necessary to ensure that consumers will not only make a purchase but return in the future. In South Korea, retailers have turned to Augmented Reality (AR) as an extremely valuable tool to provide their consumers with tailor-made experiences and a chance to test products without having to physically go in-store. For consumers who want to stick to online shopping, this technology allows them to see how certain products fit into their homes or on themselves without having to make contact with others.
Retailers should consider that the subset of consumers who choose to go in-store are looking for a seamless and efficient experience where products can be found quickly. In this example, in-store AR navigation, which uses a mobile app to provide product locations, allows consumers to shop quickly without having to worry about wandering around and searching for desired items. Additionally, consumers will end up spending additional time on the app and engaging further with the retailer.
3. Establish opportunities for contactless shopping
Covid-19 has opened the door to an updated shopping experience where the safety of the consumer takes center stage. South Korea did an outstanding job of establishing a touchless economy early on, and retailers have taken every precaution to ensure that customers can shop without making contact and still have an enjoyable experience.
In the U.S., we’ve seen big-box stores offering curbside pick-up so consumers can make their purchase online and have it delivered straight to their car’s trunk for minimal contact with others. As stores re-open around the country, retailers will need to limit the number of in-store shoppers at any one time and continue to provide consumers with opportunities to get products in-hand without having to physically enter a store. Nordstrom, for example, has announced that it will continue offering curbside pick-up but will also implement actions such as reduced fitting rooms and setting aside any merchandise that has been tried on for 24 hours.
4. Prepare for the next pandemic wave
Global pandemics of this scale are not linear. The count of daily new cases will rise and fall across time and across geographies. Cases have continued to decrease in some states, such as New York, but others, such as Arizona, Texas, and Florida, are seeing record numbers of new Covid-19 cases. Should there be a second wave, retailers will likely have the necessary processes and precautions in place to be able to get through to the other side.
In South Korea, retailers have seen great success in enacting hygiene requirements, including protective measures at check-out and sanitizing stations throughout their space. By providing contactless payment options through digital and mobile methods, consumers can scan payments on their own or pay on the retailer’s app using stored payment information. As a side effect, these risk-reducing operational changes are fueling a more omnichannel experience for shoppers
5. Encourage consumers to make up for missed opportunities (shopper FOMO)
One interesting consumer behavior that we’ve observed in South Korea has been a quick return to shopping. After months of being restrained, consumer sentiment quickly tilted back toward consumption and shoppers were ready to indulge themselves again. Luxury brands, in particular, seemed to reap the benefits of the ease in restrictions, with lines forming outside of Chanel as rumors of a price increase began to circulate.
Similar FOMO effects, i.e. the fear of missing out on something, may also be observed in the U.S. as consumption curves show that South Korea is well ahead of us. Retailers can take this opportunity to encourage consumers to make up for missed shopping opportunities by offering incentives to drive purchases.
While Covid-19 has hit the global retail ecosystem hard, many countries have already hit the peak and are entering the rebound phase. By staying attentive to trends in locations that are ahead in recovery, such as South Korea, retailers in the U.S. can ensure they’ll be well-prepared to integrate in-store and e-commerce experiences and offer safe and meaningful experiences for consumers during the rebound.
Jaysen Gillespie is VP and head of analytics and data science of Criteo.