If the brick-and-mortar retail industry had been struggling in the face of a major shift towards online over the past decade or so, then the spread of coronavirus has fatally sent many of these businesses over the edge.
It was reported in July last year that as many as one-third of small businesses in the United States alone had been forced to close as a direct result of the pandemic. In the United Kingdom, that figure was 15 percent. Whether that was due to a dependence on foot traffic, operating in a market that doesn’t cater for a stay-at-home and keep-your-distance lifestyle, or a failure to pivot effectively to online operations, these have been worrying times for many in the retail industry.
Add to that the domineering presence of online retail juggernauts like Amazon and it is of little surprise that the very future of brick-and-mortar retail is under major threat.
Yet, even during the toughest of times, there have been plenty of success stories – small businesses thriving in the most challenging of circumstances, while other stores have done remarkably well just to survive.
How have they achieved this even against the odds? Well, much of it comes down to loyalty and reputation – and both qualities are more important than ever for retail businesses to survive.
Communities band together
Every time the term ‘loyalty’ is discussed when connected to a business or brand, it normally conjures up images of die-hard Apple consumers camping overnight outside a store waiting to get their hands on a new iPhone, or the Lionel Messi supporter who will rush to purchase the footballer’s latest jersey and boots.
But loyalty in commerce is expressed in numerous ways. During the pandemic, one of the most notable demonstrations has been how communities have banded together to support local business.
In one survey conducted in the UK, it was found that 36 percent of people were making a concerted effort to support local businesses by using their takeaway and delivery services, while 30 percent said they had purchased vouchers to be used at a later date.
This sort of loyalty – not to a specific brand but to the concept of local enterprise and supporting the community – has allowed many small businesses to stay afloat.
Reputation is king
While loyalty has been a saving grace for many local retail businesses over the past few years, those allegiances can only go so far without a solid reputation.
It has become easier than ever to get information on a business and quickly determine whether to buy their goods and services. The internet is full of reviews, ratings, and rankings for everything from restaurants, hotels, and phones, to games, movies, and books.
For instance, search for the ‘top restaurants in London’ and within seconds Google will produce hundreds of pages of results. We can then immediately learn where – and where not – to go for dinner that night.
This applies to practically anything: the best vintage clothes stores, the best online casinos, the best place to buy designer handbags, the best online golf shops; the list goes on.
What it demonstrates is that having a trustworthy reputation is more vital than ever. Retailers need to be well-reviewed, by experts and customers, in order to establish and maintain a strong standing among fierce competition.
This applies not only to the quality of their goods and services but to other areas of their business, including customer service, treatment of staff, and even company community service.
Indeed, it has been shown that companies with a strong philanthropic culture enjoy increased brand loyalty and greater sales. In the retail sector, the best example of this is the footwear brand TOMS with its ‘buy one, give one’ policy.
Post-pandemic landscape
Even with the worst of the pandemic now in the past, there have been many consumer habits formed that are here to stay – namely a big switch to online shopping.
Online retail was of course a major disrupter to brick-and-mortar operations long before the coronavirus, but that has gone into overdrive over the past two years, making it vitally important for most retailers to have some sort of digital presence.
For the retailers who have been able to survive on community loyalty and reputation during the pandemic, it would be wise to increase their online operations now before it’s too late.
