Everyone is probably pretty fed up with hearing this by now but COVID-19 has changed or day to day lives since the start of 2020. Digital saw a significant increase in usage with corporations turning their attention to how it could keep revenue streams open during a time of massive unrest where physical premises were forced to close. As a vaccine is introduced and it looks like normality is returning, don’t expect digital to disappear.
Businesses that have gone under over the past few years and throughout 2020 have mostly had a singular thing in common, lack of investment in digital. BHS, House of Fraser and more recently Debenhams have had very successful stores but a target market unlikely to purchase online so haven’t invested and are therefore missing out on the growing disposable income Amazon market.
Keeping up with this new market, I believe, is what contributed heavily to their downfall. Millennials, as they are known in major media, tend to buy heavily online rather than in stores – this has been apparent for years and COVID-19 has just amplified the lack of investment and change of habits.
This style of brick and mortar store second and digital store first is working well for major brands, including Apple, who essentially use their stores as a place for people to come and see the physical products. I expect this trend to increase as Amazon continue to improve their delivery network – something that other brands are now working on with Argos offering an excellent same day delivery service, something which I bet is annoying their delivery giant of a competitor.
Modern smart phones are making it much easier for quick and convenient service with minimal human interaction. COVID-19 didn’t force this into being, it had been growing well before that, grocery stores were introducing apps where you could scan items and put them straight into bags and pay through phones, Costa and Starbucks have order before you enter the store, as do McDonalds.
This change in consumer behaviour has always been coming, the pandemic definitely sped up this change but in no way is it responsible for it. The internet has made us increasingly impatient and more into this decade will we see queue busting solutions and deliveries to cut down the wait time – I would not be surprised if in the next few years you’ll get hour delivery for all major supermarkets.
Supermarkets were caught with their pants down as the pandemic hit, a slow and cautious investment into their online systems and delivery networks meant that their systems couldn’t cope with the massive influx of demand. Just Eat and Deliveroo came to the rescue when this happened, they’ve spent millions investing in their delivery systems so were much more prepared for this.
This needs to be a lesson for all businesses, but especially those who have previously shunned digital, this isn’t something that is going to vanish once the pandemic is gone. It will continue and will be a source of revenue much more increasingly into 2021 and the coming decade.
If businesses still refuse to invest in digital technology then they will succumb to pressures and slowly start to lose revenues.
I know I’ve said all of this but ignored Primark, who are the glaring omission to this, where they are going the other way. Increasing their physical presence and having little digital footprint, but I don’t expect this to stay this way. I see them introducing digital elements gradually through partnerships and purchases as we head closer to 2030, not to replace but to compliment their physical presence.