Post-pandemic South Africa: the ‘new normal’ for retail

Retail / Online Shopping

South Africa is not at the ‘post-pandemic’ stage yet. Lightstone has reviewed key trends and themes as well as some encouraging opportunities that the ‘new normal’ is presenting in the retail space.

Covid-19 has provided some tough operational environments for retail and even though South Africa is in a downward trend, these circumstances have forced us to look to the future, perhaps sooner than initially anticipated.

Futurist Richard Watson developed a mind map in 2017 which highlights the future mega trends and technologies in a macro environment. The map predicts what 2050 may look like and because of the pandemic, these time frames have been brought forward to around 2035. By looking at the map, the large grey circles are referred to as ‘mega trends’ with the smaller circles as ‘what is happening now’ and the triangles as ‘what is happening next’. Delivery robots, as an example, were identified as part of ‘what is happening next’ but this technology, a meagre three years later, is already here and operational.

Richard Watson’s future mega trends map.

Due to what the world has recently experienced, we are already experiencing the small and local trends identified in Watson’s theory, especially from a retail perspective. Convenience and simplicity coupled with the convergence of technology has seen a significant drive toward virtualisation and personalisation which is where the understanding of the consumer becomes important.

Roger Blewett, Geospatial Solutions Consultant for Lightstone says the retail industry needs to rethink the way in which it operates under the ‘new norm’: “The current environment offers retailers an extraordinary opportunity to think about omnichannel strategies, which marries the digital with the bricks and mortar retail space, that remains simple and convenient.”

With this new shipping trend comes a need for efficient retail transactions and an entirely different approach to brand loyalty where a visit to the stores makes it worthwhile for the consumer. Retailers will need to start using data centric insights and methodologies to understand their target markets and to create better shopping experiences.

We have a huge amount of respect for retail decision makers. They need to understand the external environment from an economic perspective as well as an internal environment where cultural and consumer behaviour becomes key” says Joe Spring, Senior Solutions Consultant at Lightstone.

The retail environment is more complex than ever. Retailers need to plan for different future needs where decisions will need to be made based on location management and turning that knowledge and data into solutions. Strategies will need to be based on an understanding of the landscape, time frame and consumer behaviour trends like the shift from regional centres to hyperlocal community stores over the past year which Blewett and Spring attribute to economic conditions and the popularity of online shopping over the lockdown period. “We have tried to simplify this by using our own ‘Maps and Apps’ approach where we are able to share complex data through simple solutions”.

The map below is specifically for the traffic around the Mall of Africa in Midrand, Gauteng which represents 75% of the visits to the mall in the first and second quarter of 2020. The light and dark blue lines indicate where the first quarter (January to March 2020) were coming from and the pink lines indicate the second quarter (April to June 2020) visits which have clearly contracted substantially.

Essentially this move to localisation and convenience shopping is not a simple shift,” says Spring, “It means that the super regionals will need to play a slightly different role in driving shopping behaviour and understanding consumers’ future dependency on shopping malls. Shopping decisions will be based on customer loyalty and the experiences offered by that destination”.  

Straight out of the ‘Covid-19 gate’, Lightstone released the ShopSafe App which offers users a view of the peak shopping times of a specific mall so shoppers could plan their ‘safe’ shopping times and retailers could maintain a steady stream of customers as opposed to the traditional peak times. This is an example of how consumer behaviour is influencing retail activity.

From an e-commerce perspective, using this data to influence the infrastructure of e-commerce deliveries will help reduce repeat deliveries to the same location and protect a brand’s consumer satisfaction score by limiting delays and non-deliveries. Partnering with the likes of What3Words that enables data companies to pinpoint locations will help online businesses reduce the number of abandoned carts due to insufficient location options available to online shoppers.

Data is an incredibly powerful tool in getting to Know Your Customer (KYC). By using this type of information strategically, online, offline and omnichannel retailers will be able to identify areas where they can grow and help define product and/or service activity either from you to them, or the other way around,” concludes Spring.