Similar to Michael Corleone’s frustration in Godfather Part III, just when we thought we were out of the pandemic, the Omicron strain has pulled us back in. How will the experience dealing with Covid thus far help retailers deal with these current pandemic conditions? What lessons are likely to carry forward beyond the current Covid crisis? Are there differences between how entertainment and home office device retailers and how appliance retailers fared during this challenging period, and how they deal with heath-concerned customers?
“Major appliance retailers had the advantage of being an ‘essential’ product, and consumers who were nesting at home needed to both protect their need of a refrigerator, washer, range, etc.,” observes John Riddle, president and CEO of Howard’s Appliance. “Plus, [quarantining consumers] were unintentionally wearing out the appliances at home because of overuse. I think those same retailers had a challenge, though, of having the other element of home delivery and home installation.”
Regardless of what type goods are displayed on show floors or shelves, creating a safe and consistent in-store experience was and is a key piece of pandemic retailing. “Our speed of implementing safety protocols and insuring safety for all consumers and staff was unprecedented in the industry,” Riddle proudly relates. “While our competitors were closing shop, Howard’s stayed open. Our approach was to first let customers know that we were open and committed to serving them through the pandemic. We quickly addressed safety protocols for in-home deliveries, allowing customers to be able to feel comfortable to allow delivery and installation teams into their homes.”
Next, presenting and reacting as neighbors helped maintain consistent traffic. Technology retailers who anticipated and fulfilled customer needs rather than simply impersonally selling products succeeded. “Howard’s quickly offered solutions like Zoom Call Shopping, ‘loaner’ products if the consumer’s choice of purchase was not available, and broader portfolios of product offerings in each category to make sure consumers still had several choices,” Riddle says. “We launched personalized appointments so that customers were aware that they did not need to go into a store to purchase their appliances. We also put a tremendous focus on in-stock products that were available for next day delivery for customers who had an immediate need.”
Another key to pandemic retail success was not only having enough inventory on hand, but inventory of the right products. For instance, Riddle reports a huge spike of consumer interest in smart, connected appliances. “Consumers were able to research heavily. All generations were nested at home and able to help each other on the research and benefits of smart/connected major appliances. Our Experience Centers facilitated their shopping experience and made the journey frictionless.”
One ongoing challenge for retailers during Covid has been pricing, both due to normal fluctuations, tariff reaction, spikes precipitated by supply chain, and the current inflationary trend. “Price was less important during the pandemic as availability and demand rose,” Riddle opines. “Availability drove a higher-than-normal factoring in the consumer’s choice. But as availability improves, I believe promotional importance will rise.
“Our industry has two primary price levers,” Riddle continues, “invoice price and promotional cadence. Since 2018, there have been steady price increases and more dramatic in scope in 2020 and 2021. Promotional cadence of course has decreased significantly since July of 2020. I believe the industry will need to be careful on the impact of inflation on the consumer.”
Riddle also notes that with ongoing supply chain uncertainty, retailers have had to rethink promotions. “We have had to be nimbler due to the long lead times for product and lack of promotional support from brands,” he says. “While we used to have market month-long promotions, we have had to market our own promotions in shorter promotional windows. The new normal is to continue to focus on in-stock products in our promotional marketing.”
With more consumers staying home to shop, retailers have had to adjust all their marketing and selling techniques – techniques such as BOPIS that, when implemented successfully, are likely to survive the pandemic and become part of consumer tech retailing’s “new normal.”
“[The pandemic] caused us to look at the decades-old consumer journey in major consumer durables and re-evaluate,” Riddle explains. “We expanded staffing, training, and new digital tools to create a new customer experience. We have developed a store-wide training initiative and an intern hiring program. All our Experience Centers feature ‘live’ product for the consumer to play with…and engage with our product advisors, who are all now armed with iPads and an ability to see and show the best ways their products can be used at home.”
See also: Executive Insight: What’s Next For The Retail Environment In Home Audio?