The New Normal: Permanent Shifts Expected in the Retail and Hospitality Industries

November 2020

As the COVID-19 pandemic drives seismic shifts across consumer markets, the key question facing business strategists is which of these changes are more reactionary in nature versus signalling the start of a long-term behavioural shift. This briefing explores which of these shifts will likely become permanent across the retail and hospitality industries in the post-pandemic era, providing a glimpse of the new normal for those operating in these consumer-facing environments.

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This report comes in PPT.

Key Findings

Retail and hospitality industries among the hardest hit

COVID-19 has impacted high-touch service industries the hardest. In-person physical experiences, such as dining out, were nearly brought to a standstill due to mandated lockdowns and other restrictions, forcing consumers to online channels to obtain goods or services.

Not all these newly christened behaviours will stick post-pandemic

While new consumer behaviours have emerged during this crisis, not all will remain relevant in a post-pandemic era. Some, like the physical barriers installed to keep consumers a safe distance from store staff, are likely just stopgap measures that will fade as a vaccine or viable treatment for COVID-19 reduces virus risk.

New experiences with the momentum and market could become cemented

Consumer attitudes regarding travelling, dining out and shopping will be forever transformed. Many behaviours that have become ingrained during the crisis, such as shopping online, will be retained to some degree even as life begins to approach normality.

Digitalisation is at the core of many of the crisis-inspired shifts

The digital transformation was unfolding across the retail and hospitality industries before COVID-19, but its importance was elevated due to the necessity to survive and stay afloat. During the crisis, retail and hospitality operators shifted to digital in hopes of capturing lost revenue from closures and restrictions.

Build back better becomes the cry of many consumers and business leaders

The pandemic has awakened consumer interest in more sustainable consumption, especially the attention given to businesses that act with a greater sense of purpose. More consumers are looking at how brands treat people as well as the environment, forcing leaders to consider the actions taken to generate profits.

Scope
Key findings
Our themes that explore how COVID-19 has impacted consumer markets
The "new normal": what’s here to stay for retail and hospitality?
COVID-19 likely to lead to a permanent shift in consumer behaviour
Consumer Finance: COVID-19 accelerating the decline of cash usage
Consumer Finance: crisis boosts the sustained move away from cash
Case study: Fintech Swish capitalises on the consumer shift in payments
Consumer Foodservice: lockdowns force industry evolution
Consumer Foodservice: fewer restaurant meals, more prepared meals
Case study: Wow Bao launches national ghost kitchen programme
Retailing: pandemic destabilises consumer confidence, store operations
Retailing: expected trajectory of e-commerce accelerated by COVID-19
Case study: MercadoLibre launches online supermarket features
Sports: returning fans to live sports events remains an unresolved hurdle
Sports: tech promises to deliver the balance of safety and experience
Case study: WaitTime Crowd Intelligence software to rise to challenges
Travel: industry collapses amid restrictions, fears over virus transmission
Travel: uncertain times accelerate the move towards responsible tourism
Case study: Iniciativa Imagine supports sustainable actions
Permanent shifts expected across the retail and hospitality industries
Digitalisation is at the core of many of these crisis-inspired shifts
Rising interest in sustainable consumption also coming to the fore
Reinvention of the last mile is an example of a trend with opposing forces
What should retail and hospitality operators focus on?
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