How Retailers Can Win Big by Embracing the Digital Consumer

Posted: May 14, 2021
Category: Spotlight on Business

Was it really just a year ago that all the buzz in retail was around “experiential retailing?” When Canada Goose, the clothing company, was creating arctic zones in stores so customers could feel just how warm a CG parka would keep them? One very long year and one global pandemic later, the retail landscape has changed vastly and experiential retail is all but dead. At least for now. Because with no people to experience it, well, it just doesn’t matter.

What did matter to consumers in 2020 and will in 2021 is financial security, health, safety, and—especially as working from home becomes the norm—comfort. Consumers are also more concerned and demonstrating with their wallets, the importance of social responsibility and sustainability. Retailers who embrace these consumer trends will be the big winners in 2021.

2020 was the Year of the Digital Consumer

With discretionary spending on the decline, some consumers are sticking with trusted brands. Others, however, driven by thrift, will switch to store brands from stores they trust. McKinsey’s research shows that 20% of people have switched to store brands and 50% of them plan to stick with them. Retailers with strong private label brands may benefit by extending their own brands into new categories.

The pandemic lockdown did for e-commerce what global warming did for hybrid and electric vehicles. While digital commerce was already on the rise, it caught fire in 2020. JP Morgan states that U.S. Consumers spent $211.5 billion during the second quarter of 2020 – up 31% over 2019. NPD discovered that consumers plan to do 48% of their holiday shopping online, up from 41% in 2019. Companies that were not prepared with a shipping partner lost out. In fact, UPS placed limits on large companies such as Nike and Gap to manage the anticipated eCommerce holiday surge.

Technology enables safe commerce

As touching became taboo, consumers looked for touch-free ways of shopping. A study by Accenture shows that 54% of consumers had used contactless payment prior to the pandemic and 87% since. In-app ordering increased from 54% to 84%. Home delivery rose from 47% to 82%. Many of these consumers don’t plan to go back to their old ways of shopping. And it’s not just Millennials. According to the National Retail Foundation October 2020 study, among Baby Boomers, 58% have bought online and picked up at the register and 30% have used curbside pickup. More Boomers are also using delivery services. The digital-forward consumer is here to stay.

What retailers must do to win digitally in 2021

To say that retailers should focus on digital would be to state the obvious; it goes deeper than that. For short and long-term success, retailers should:

  • Offer incentives for first-time shoppers
  • Digitally enable every step of the buyer’s journey and post-sale relationshipDevise tools that provide an in-store like experience such as MAC Cosmetics lipstick color app
  • Where appropriate, utilize chat, SMS, and video chat platforms
  • Respond quickly to customer issues and enable customer service across channels
  • Rethink media mix to include virtual reality, video games, and over-the-top tv and shift away from out-of-home and print
  • Facilitate curbside pickup and contactless delivery
  • Offer free shipping and easy returns, if financially viable
  • Leverage digital tools in-store: contactless payment, QR codes for product information, and augmented reality


The COVID-19 pandemic accelerated consumer adoption of digital retail by years, not months. Companies that were already digitally-enabled were able to quickly serve consumers. Some experienced unexpected and explosively high growth. To win in 2021, retailers who have not yet digitally enabled the entire customer journey must do so. From marketing to merchandising to delivery and customer service, retailers must meet customers on their terms or risk being the next victim of the retail apocalypse.

About the Author:

Beth VanStory is a Partner and Chief Marketing Officer with Chief Outsiders, the nation’s leading fractional CMO firm focused on mid-size company growth. She works with consumer services, retail, and healthcare companies to leverage digital tools and channels to launch new products and grow revenues.

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