While big brands like Canada Goose, Neiman Marcus, and Brooks Brothers have seen sales plummet due to the pandemic, other retailers have experienced massive jumps in demand. Big box stores have seen a sharp rise in sales of electronics, beauty, and food. Walmart saw its Q2 same-store sales increase by 10 percent and online sales increase by 97 percent. Target’s Q2 sales spiked by 24 percent overall and a staggering 195 percent in digital; according to Target CEO Brian Cornell, the company gained a year’s worth of market share in Q1 alone and doubled that in Q2—bringing its year-over-year share gains to more than $5 billion.
Other sectors saw similar jumps. With many quarantined consumers taking on DIY projects, demand at hardware stores shot up; Home Depot’s sales rose 23 percent in Q2. Grocery stores also saw a sharp spike, given many consumers’ reluctance to eat out.
These increases are largely occurring for two reasons.
First, while consumers continue to adopt a stay-at-home lifestyle, they are filling bigger baskets with more and/or different products. Beyond more household staples, people are buying more locally sourced goods, more sustainable options, and more health-centric products—all longer-term trends that have accelerated in the wake of COVID-19.
Second, the pandemic has pushed consumers to more established retailers. These companies are stealing market share with better online delivery options, more competitive prices, and speedier transactions through contactless payment and self-checkout.
Current brand leaders will want to turn this wave of transactions into long-term relationships—and that requires the right communication strategies.
First and foremost, retailers need to get in front of consumers. That means in-store communication that clearly highlights the value and/or experience offered by the retailer, along with follow-up messaging that keeps it top-of-mind moving forward.
Loyalty programs are another critical touchpoint—their communications must be well-executed and highly strategic. First, they must convince consumers of the value of the program—at a time when changing needs and mindsets are redefining loyalty. Then they must continually remind customers of program benefits—again, at a time when research has shown that during a pandemic, fewer people care about brands.
With these challenges in mind, content and tone are key. Brands must look to form more emotive relationships with consumers, and to do that, their communications must go beyond the purely functional and promotional. Content needs to demonstrate a deeper understanding of consumers’ need states and interests. The message must be genuine. Enablers like personalization and segmentation are important—but they must be accompanied by processes and platforms that enable large companies remain efficient. The results of these high-performing retailers are very positive at a time when the industry is reeling. But the wave will likely recede if these brands don’t capitalize on their momentum: Competitor retailers are certain to catch up and steal back share as consumers and companies alike settle into the new normal.