Rethinking the retail experience

Lockdowns and working from home have had a profound effect on the Australian way of life, including what we expect from a retail experience.

Key points

  • Consumer behaviour and expectations have changed dramatically.
  • Omni-Channel retailing is required to meet customer demands.
  • Retailers need to remain dynamic in their physical and online product offerings.

The new way of shopping

The pandemic is accelerating the trend towards digitisation in the home, in the workplace, in the way services are accessed. Shopping is now done online, and delivery vans are now a regular feature of suburban traffic.

The options for accessing retail services seem endless: there’s home delivery, click and collect, kerbside pick-up as well as the traditional concept of actually browsing and buying from a shopping centre.

But even here there is new technology to navigate like accessing QR codes and registering email and/or phone numbers in order to simply attend shops.

In terms of actual retail sales, the pandemic has prompted a shift in traditional spending patterns. Liquor sales jumped 27 per cent in the year to June 2020, according to ABS estimates1. This compares with growth of just 2 per cent over the previous year.

Other sectors that surged over 2019/20 in terms of retail spending include hardware, electrical and furniture, all up more than 14 per cent over the year.1 It’s a consistent story: the pandemic prompted Australians to transfer spending otherwise tagged to international travel to home improvement, and embellishing and adorning their immediate environment.

The rise of the 20-minute city

However, there’s a larger narrative behind these trends. It revolves around the idea that our way of (urban) life is under review. For the better part of a century Australians lived in the suburbs and commuted into workplaces in the CBD or the inner city.

But in the post-COVID world this model is being disrupted with a greater proportion of the workforce now likely to work more often from home, even if for only a few days per week.

The post-COVID model that seems to be emerging correlates strongly to a concept that town planners have supported for 20 years or more. This is the idea of the 20-minute city where work, school, shops and services are provided in sufficient measure in suburban regions to enable local residents to live, work and play within a local area.

This model reduces carbon emissions, is kinder to our collective mental health, and activates suburbia which traditionally has lain dormant for perhaps 8-10 hours per day, as residents often worked in distant workplaces.

Shopping in the post-COVID world

Australians have shown an aptitude for online shopping, for browsing online catalogues and for ordering and paying online too. But they also have shown the potential to re-energise their local shopping strips and centres due to working from home. This is a different retail model to that which prevailed prior to the pandemic. In this brave new world, the key for retailers is to maintain an integrated presence in both online and offline channels to satisfy the different consumer preferences.

The good news is that the economic downturn triggered by the pandemic and its lockdown responses appears to be receding with GDP growth exceeding three percentage points for the September Quarter and again for the December Quarter.

Australia is a prosperous nation and Australians have demonstrated an aptitude for retail spending, especially at times when the economy is on the upswing.

But the old ways of delivering retail goods to the customer base are changing. The modern consumer wants to click and collect, to order online, to pay seamlessly, or indeed to pop into a shop, browse and walk out again.

Shopping in the future

In the 20-minute city of the future Australians will precisely have the lifestyle they want: to work at home as they wish, to access retail goods and services from within the local area, to have goods delivered to the home, or indeed to go to a regional shopping centre for the theatre, the experience, of shopping in a grand marketplace.

It really is all about Australians having and exercising the choice to engage with retailers on terms that suits them.


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1 ABS Retail Trade, released on Feb 2021.