SUMMARY: Stuck at home and unable to spend as much as they normally would in restaurants, bars, and cinemas, consumers have accumulated $1.6trn in excess savings during the past year. They’re ready to spend, but what will they find when they return to brick-and-mortar stores?
Biden’s $1.9 trillion dollar stimulus plan is going to put more cash in the pockets of anxious consumers. Research by JPMorgan Chase suggests that consumption will soon rebound to near its pre-pandemic level, powering a strong global recovery. Goldman Sachs, another bank, reckons that in America the spending of excess savings will add two percentage points to GDP growth in the year after full reopening. That points to a fairly rapid recovery in both output and employment.
So the question is where will they spend it? More than half of U.S. consumers plan to buy apparel in the coming months, making it the top category of anticipated spending, followed by footwear and beauty products, according to NPD. But consumers may find that their favorite retail stores are not the same.
It’s likely that in your town, just about every retailer has “help wanted” signs posted. Many people who were let go because of the pandemic have moved on to other jobs; others have no intention of returning to retail shops for minimum wages. Some businesses reopening after the pandemic shutdown find that the supplemental $600 per week offered under the federal Coronavirus Aid, Relief, and Economic Security Act is a disincentive for workers who can make more money by remaining unemployed.
The other issue when it comes to retail is customer service or lack thereof. Finding qualified help at some stores is almost impossible, and one has to wonder if it will lead to a continued surge in e-commerce sales. In 2021, eCommerce sales are expected to account for 18.1 percent of retail sales worldwide but more than one-third of American small businesses do not have a website
What about apparel purchases?
When it comes to the categories that consumers are buying online, retail leaders were surprisingly out of touch. For example, all or nearly all executives believe consumers plan to buy beauty (100 percent), home décor (97 percent), home improvement (95 percent), and luxury (97 percent). Meanwhile, 29 percent of consumers said they do not plan to buy beauty products, 28 percent do not plan to purchase home décor, 33 percent do not plan to buy home improvement items, and 39 percent do not plan to buy luxury.
When considering where consumers are purchasing the products they buy, we are seeing a significant disconnect on apparel and footwear when it comes to online shopping preferences. Only 16 percent of senior executives believe consumers are purchasing apparel exclusively online, compared to two times more of consumers (31 percent) who say they plan to. In the footwear category, only 11 percent of executives believe consumers are planning to buy footwear online-only, compared to two times more consumers (25 percent). In apparel, brick-and-mortar stores rule.
eMarketer says “consumers who have avoided buying clothes online usually cite an inability to determine product fit and fabric, as well as apprehension toward shipping fees or difficult return processes as reasons to not purchase. But improved product information and streamlined logistics are changing some consumers’ minds”.
Women Love To Shop
Women and shopping are inseparable. In a way; shopping happens to be a woman’s ‘best friend’ in her good days as well as in her bad days. Either it is a style matter or just for pleasure; but most of the time, it is connected to some kind of emotions. Emotions that run high-or-low; and make a woman run after spending.
These are few of the reasons Fashion Potluck says are associated with the shopping habits of women:
- To keep up with the latest fashion and styles.
- To meet some unfulfilled desires.
- To look their best- no matter where and with whom they are!
- To take the superior stance- Until men and women are on a level playing field in terms of rights, income and, leadership; some differences that pop-up every now and then in our society will continue, and the struggle to take-on certain responsibilities that will look and feel women-driven will continue raising its voice to take the feminist stance! And this is one of the important reasons, women like to shop more than men!
- To feel in control of power- Shopping is a liberating process to attend and act towards a woman’s desire and wishlist. They feel empowered to meet their demands and desires by purchasing what they want! “It feels so liberating to buy yourself what you want, and when you want it!”
- Women bond strongly when they shop together!
- Shopping happens to be one of the best, and most-favorite self-care rituals for a woman.
- Women like to grab the best deals, and later show them off to others!
- Women are usually assigned [by the society] with the task of taking care of the family, while men go out to work. To break themselves free from this monotony, women go out shopping. They find shopping to be the best reason to go out of their houses and socialize with others.
- When women know what they want and why they want to buy the goods they wish and desire; they feel more balanced and in control of their lives; which actually helps in reducing their stress!
- Women are now breaking free from their gender roles, and finding easy ways to shop, learn, and to grow personally and professionally! They are taking equal responsibilities in creating a better life for themselves and for their family. And that’s why they are comfortable with both; shopping at stores or online.
Retail has been constantly reinventing itself, and participants race to keep up with what feels like a series of epic shifts in consumer preferences. Many have invested heavily in online stores, free shipping, and easy returns but the return of online goods can still be a major hassle. I have no doubt that eCommerce sales will remain strong but despite the increases in online sales off-line sales still, dominate. Retailers will adapt and will find ways to lure consumers back into stores.