Even before Covid-19 took the world by surprise, the retail industry was already experiencing significant transformation. The internet had changed consumers’ purchasing behavior and e-commerce was a growing share of the market. Brands like Walmart and Target were investing in digital operations, and fashion houses were realizing that Instagram might be their biggest competitor. Now the retail industry has found another reason to adapt.
Quartz’s latest presentation for members looks at the continued evolution of the retail sector, which has been accelerated by Covid-19.
Retail has proven to be one of the United States’ most dependable industries. Depending on how the data is categorized, it is either the country’s first or second-largest employer. Despite the rise of e-commerce, the long term trajectory has been growth for retail sales and jobs.
Retail came to a halt after the onslaught of Covid-19. In April 2020, sales were down 17.8% compared to the prior year. This decrease is largely due to government-mandated social distancing orders to limit the spread of the coronavirus and consumers cutting down on discretionary spending because of rising unemployment and expectations of a recession.
Retailers deemed essential have experienced a surge in sales while nonessential brands, especially clothing brands with short inventory life cycles, have suffered the most. Companies have taken different approaches to mitigate financial damage. Many others are reducing store counts and retroactively investing in digital. A notable few have been unable to escape bankruptcy.
Amazon, as expected, is flourishing, thanks to its efficient customer-focused digital operations and delivery model. Circumspect consumers, wary of stepping outside, flocked to the website to shop for all things essential.
To see all of the slides, you can view the PDF version or download the PowerPoint file, which includes our sources and notes. This is one of an ongoing series of member-exclusive presentations, which you can read, reformat, and use as you wish.
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