Disruption is nothing new in retail. While market shocks, omni-channel engagement, social media, and shifting consumer preferences have battered traditional retailers over recent years, those with foresight and an appetite for digital transformation have unearthed opportunities for profit and growth.
In 2019, KPMG drew clear contours around trends that defined the rapidly changing retail landscape. Among them:
- Harnessing consumer-centric data to deliver hyper-personalization
- Finding ways to satisfy price-savvy consumers who now have access to multiple retail channels
- Growing consumer comfort with AI-powered service agents
- Adopting new retail platforms that use transactional data in powerful new ways
In the face of these shifts, retailers that resisted or delayed modernization risked ceding their futures to their more agile competitors.
As the first quarter of 2020 emerged, even the upheaval of the previous year would begin to look tame. The COVID-19 pandemic triggered lockdowns and occupancy restrictions that sent overall retail sales into a decline of nearly 20 percent year-to-year in March and April. Retailers deemed essential (grocery and drug stores) saw revenues reach historic highs in March, while sellers of new essentials (especially home improvement) increased year-to-year sales by up to 19 percent from August through November. For online retailers, the pandemic fueled record sales as consumers of clothing and other goods fled in-person shopping for the relative safety of ordering from home.