What: Some retail executives believe offline sales will slowly start to surge again.

Why is it important: In the third quarter of 2020, online sales in China increased by 27% , while offline sales declined by 4%.

Not everyone believes that this consumer shift will push online shopping ahead of offline over the long run. In fact, some retail executives believe offline sales will slowly start to surge again. Therefore, consumption patterns in 2021 will change again, and new opportunities and movements will shape the collective identity.

Online

CNBC reports that Alibaba and JD.com set new records during the 2020 Singles Day shopping event by hitting around USD 115 billion in sales online. Companies that want to take advantage of the O2O trend should invest in visual recognition algorithms, AR-powered gamification software to boost customer loyalty and engagement, artificial intelligence (AI) chatbots that respond to customer inquiries, and data analytics systems to assist with personalized purchasing recommendations.

Physical

Luxury buyers expect businesses to integrate more health and safety measures. Agile retailers have responded to this shift by incorporating innovative technologies, such as contactless kerbside pickup, indoor positioning system technology, AI-enabled, smart-shopping carts, and radio frequency identification (RFID) technology, which helps with product tagging.

However, the vast majority of offline retailers still need to adopt efficient, consumer-centric services, such as buying-online-and-picking-up-in-store (BOPIS) services, partnerships with super-apps, like WeChat and Alipay, and technologies that boost the omnichannel experience across all platforms.

Alibaba-owned department store Intime and Japanese multinational personal care company Shiseido are training their sales consultants to use livestreaming, boosting their in-store marketing efforts. “We need to merge online and offline to get people to buy more,” said Shiseido’s CEO, Masahiko Uotani, in an interview.

Showroom models

For many businesses, the showroom model has been perfectly suited for the post-COVID-19 environment. Pop-up stores bring in higher engagement, are 80% less expensive than traditional stores on average, and represent a safer option than conventional stores.

Unsurprisingly, China is already using new technologies to enhance the showroom model and promote pop-up shopping experiences. “This match made in heaven between Chinese consumer culture and the pop-up phenomenon is one of the reasons why pop-up stores have been on the rise in China,” said Storefront CMO Stephanie Kidder. “In fact, the compound annual growth rate of pop-up retailing has exceeded 100% since 2015, and estimations tell us that by 2020, over 3 000 pop-up stores will have been launched in China.”

Will Post-Pandemic Retail Be Online Or Offline