Reproduced from – https://www.linkedin.com/pulse/diary-retail-technologist-week-4-lockdown-we-yet-avneendra-arun/
This is my week 2 of this diary and week#4 of lockdown – it was another heavy week with lot of mind boggling news across globe and around me. The key thing that is on my mind is how long this will go and what are the short term and long term impacts of a pandemic like this (especially in my retail sector).
I will begin this post with a transcript of a regular conversations with my daughters in my car –
My Daughter(s) – Daddy !! Are we there yet?
Me – Let’s look at the GPS, what does it say?
My Daughter(s) – ummm, 2 hour 40 minutes to destination.
Me- yes, so can you please not ask me this question again for next 2 hour 40 minutes 🙂
….. (5 minutes later) ….
My Daughter(s) – Daddy !! Are we there yet?
I think I can finally relate to my daughter(s) on constantly checking the status even when they know very well nothing has changed yet. I keep finding myself throughout day checking graphs and data from bookmarks saved from multiple sites- john hopkins, cnn, bloomberg, nytimes and bunch of other places to slice and dice the covid-19 data.
I am trying to figure out how I can make sense of everything – when will this thing end, how it is impacting the industry that I work for? Here is how my mind hopped across few things this week.
US Official Global Travel Advisor Levels
Firstly I wanted to get a sense & scale of how bad things are … I have been looking at the official travel advisory levels that US Government (Department of State) issues whether we should travel to a country or not. Refer- https://travel.state.gov/content/travel/en/traveladvisories/traveladvisories.html/ – they mainly divide it at four levels which are pretty much self descriptive –
- Level 1: Exercise Normal Precautions
- Level 2: Exercise Increased Caution
- Level 3: Reconsider Travel
- Level 4: Do Not Travel
So it hit me that maybe this is a good scale to measure how bad things are not just at global level but also at a local level if it is safe for someone like me or my family to go shopping at my nearby retail store or should I “Level 3 Reconsider Travel” or “Level 4 Do Not Travel” (weird times !!)
Avneendra’s Unofficial Multichannel Shopping Advisory Levels
Tan Tan Tan !! <DrumRolls>
Here I present you my unofficial multichannel shopping advisory levels .. now, frankly speaking I never thought that I would need to categorize a retailer’s multichannel ordering strategies to above US travel advisory based on “human to human infection” aspect, but these are strange times and hence here is how it looks if I try to do that-
- Channel 1: Online/Ecommerce Orders – “human to human touch” is minimum for this case as it happen only during order fulfillment and order delivery. Accordingly the spread of virus is minimum (there could be some contamination in supply chain/delivery- but still that would be minimal)- hence most of the customers have adopted this as their preferred shopping experience in current troubled pandemic time. Accordingly, on the scale of US Travel Advisory this is “Level 1: Exercise Normal Precautions” .. but you can still shop !!
- Channel 2: Curbside Pickup Orders – “human to human infection” increases little bit as customers order online and goto parking lot to pickup where store associate delivers the order directly to their car. However still the chance of infection here is still very minimal as in many cases customers can remain in car with windows closed if being real careful at this point. (I am doing this currently for my curbside pickups of groceries). Accordingly, on the scale of US Travel Advisory this is “Level 2: Exercise Increased Caution” .. shop, but with caution !!
- Channel 3: In Store Pickup Orders – “human to human infection” increases further as customer needs to walk in the store to pickup their order. Customers can still maintain the six-feet separation guideline as much as possible, but still there is some chance of infection. Accordingly, on the scale of US Travel Advisory this is “Level 3: Reconsider Travel” .. ie. shop and go inside store if you need something essential, else use channel 1 or 2.
- Channel 4: Brick & Mortar Retail Orders – “human to human infection” is at maximum here as the store would have lots of people and hence higher chance of infection. Accordingly, on the scale of US Travel Advisory as of now this has become “Level 4: Do Not Travel” .. only the essential stores are open at this moment and all non essential stores are closed.
The Recovery Predictions
Next, I tried to guesstimate how things got escalated from Level 1 earlier this year to Level 4 right now … and how much time it may take (best case or worst case) to go back to Level 1 – the point where all essential and non essential retail stores open up and customers also feel comfortable stepping out from home and visit these stores in person.
As I am writing this post, I am reading many news articles with various predictions and overall theme that I see it it might take anywhere between May-August or even year end to go back to normal .. https://www.cnn.com/2020/04/08/politics/what-matters-april-8/index.html
The pain may last until August — The updated model assumes social distancing measures, including the closure of schools and businesses.
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Impacts of Covid-19 on Retailers
- Curb Side Pickup is going to become a new normal – in the last decade, all retailers invested on either ship to home or In Store Pickup models (which includes Ship to Store). Since there is an upfront investment needed to enable curb side pickup as its not just IT changes but store associate process changes to enable curb side delivery of items, hence there was a mixed adoption of that model. However, due to the covid-19 situation, almost all retailers have enabled curb-side pickup .. I think this investment will provide value to retailers for time to come as its a win-win for retailers (aligned to idea of using stores as fulfillment centers) and customers (convenience of not going inside store). This reminds me of the experience of drive-through fast food delivery when I arrived in USA, I just admired on how effective and how practical that system is. I think curbside pickup will do similar thing what drive-through did for fast food industry.
- Retail Mobile Apps will drive more self-service with job of store associates (within store) – earlier mobile apps were seen only as ordering channel. But due to covid-19 situation, customers may adopt a behaviour of not talking to store associates and do more self-service. For example, I planned to buy a garage fridge from Lowes few weeks back (to stock up frozen food :)) .. and when I went to store, I used as much app as I can, where earlier I would have talked to a store associate. Many large retailers have already done this (walmart, target, home depot) i.e. changing the app experience when you walk into a physical store, but small to mid size retailers are still to catchup on this trend and I feel covid-19 may accelerate this.
- Store Inventory visibility on App – this is corollary of above point and another area where almost all the big retailers have already adopted (walmart, home depot, target), where you check on your app on location of aisle etc for a particular item that you are searching for in the store.
- Grocery Pickup and Deliveries (increased adoption with few caveats) – I have been using groceries pickup and deliveries for last 2 years (walmart and harris teeter) and have been a happy customer there and have always felt this would be the future where most folks will shop grocery this way only. Although due to the nature of human behaviour change, I did expect overall adoption will be slow and may take 5-10-20 years. After noticing covid-19, my first reaction was it will now accelerate that adoption among masses. However in last 1 month of grocery pickup and delivery, I had the worst experiences as all the stores didn’t have available windows for pickup/deliveries and most of the items are out of stock online – so I wonder if new customers/adopters of this model would have this bad taste as well and will stay away from this once life becomes normal. I have mixed feelings about this and feel it may remain up even after covid-19 but still might not be that high and will depend on groceries way of implementing this.
- Store Closure and Bankruptcies – The year 2008 took lot of casualty of many stores closing and bankruptcies – refer https://risnews.com/2008-ends-big-year-store-closings – most of these were already non performing assets which was further pushed by 2008 crisis to tip over. I think 2020 covid-19 will cause similar thing where any and all non-performing stores and retailers will get tipped over. It’s a hard reality and nothing we do or say will change it and one can only hope not to be on these ships when they start sinking.
Ok, enough heavy talk !! .. Let me close this post on a MUSICAL note similar to last week.
This week I picked up my guitar as this is perhaps the first time after college that I am able to play and practice for extended period of time without getting distracted and pulled into other things. In the following video, I am trying to remember few of the songs that I used to play earlier and my intent in next few week will be to practice more and improve my game there .. talk to you all again next week !!!