How has COVID-19 impacted the fashion retail industry?
While every sector has been affected by COVID-19 in some way, the retail industry has experienced one of the most dramatic shifts of all. Of these, the clothing and apparel sector was hit the hardest.
The retail industry, particularly the clothing and apparel sector, was one of the hardest hit by COVID-19. Lockdown meant that in a sector where over 80% of transactions occur in physical space, physical stores were forced to close. In the first month of UK lockdown, March 2020, government statistics showed a fall in sales of 34.8% month-on-month. In April 2020, this was a record 50.2%.
Although there was a boom in e-commerce and increased sales for many brands, looking at annual loss in profit these sales were not enough to compensate.
How has COVID-19 has impacted consumer behaviour around fashion?
The pressures of the first lockdown forced unexpected shifts in consumer behaviour. A mid-2020 Mintel report found that consumers under lockdown were diverting funds that would normally have been used for a holiday or a night out into home improvement or entertainment purchases. Fashion falls under this category as well, although not to the same extent.
With physical stores closed, ecommerce shopping became the standard for most consumers going forward, but this presented some issues. Consumers could no longer try before they buy, which meant many were hesitant to commit to a purchase, especially with fashion not being seen as an essential item.
How has the retail space used technology to tackle the challenges of COVID-19?
The biggest challenge for many retailers was the shift to a primarily ecommerce platform, particularly during the initial lockdown period. For those with an underdeveloped or non-existent commerce platform, taking the first leap into ecommerce can be made much simpler when they use a modular and configurable online system.
With the fashion industry struggling under COVID-19, online selling and payment platforms have the flexibility to offer outstanding support. Setting up an ecommerce platform that can offer multiple forms of payment is convenient for customers, and it won’t feel like a temporary or wasted effort when lockdown eases up as ecommerce has the ability to support, not replace, the retail store.
How can this technology continue to help retailers in 2021?
These online selling platforms have been crucial for the retail sector so far and will continue to be a massive support in the new year. The advantage of an ecommerce store is that it does not need to replace the brick-and-mortar store.
Merchants can offer an omnichannel experience to customers that supports their new behaviours in a coronavirus world. Buy online, pick up in-store (BOPIS), try in-store, and purchase online and other offline/online hybrid shopping experiences can become more widespread. This can help to cut down significantly on queue times, which can be a major issue in big clothing stores, and offers a more hygienic option for payment, which is on many consumers minds right now.