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The Digital Economy Leaps Forward by Lorenzo C . Formoso
Ambassador , Asia Pacific World Retail Congress
Vice-Chairman , Philippine Retailers Association
The year 2020 is the unprecedented year that no one was ready for . The global pandemic that is COVID-19 has changed our entire lives affecting all of us in unimaginable ways . The business sector , especially the retail industry had to bear the brunt of all the challenges brought about by the government lockdowns and strict health protocols required in response to combating the current pandemic . The limited human interaction and prohibition of face-to-face encounters between and amongst individuals due to fear of getting the virus in crowded places has certainly affected retail performance this year .
In Asia-Pacific , the pandemic has accelerated ecommerce and digital trends in retail . While ecommerce has been continually growing in the region pre-COVID , it has definitely surged and accelerated this year . Lockdowns compelled consumers to shop online for their safety and protection from the virus .
The health crisis also changed and significantly influenced the market demands . Primarily , there was an increased demand for health and hygiene products . Based on trends in the region , retail sub-sectors such as pharmaceuticals and drug stores , supermarkets and groceries , furniture and home improvement , and electronic gadgets for home entertainment , have seen strong sales . On the other hand , travel retail , fashion , franchises in food and merchandise , and automotive retail among others , are greatly affected .
Despite these challenges and rapid shifts in market trends , retail in Asia Pacific stays afloat because of the region ’ s
booming digital economy . The acceleration of ecommerce has been fuelled by the rise of digital trends such as e-payments and digital wallet apps . Retailers sought to enhance and accelerate the development of their omnichannel strategies , which streamline their ecommerce sites and bricks-and-mortar stores , and also provide consumers with reliable contactless payment options .
As well as ecommerce , community or neighbourhood markets have grown in the region , particularly in the Philippines . Because of social restrictions in malls , retailers moved to outdoor retailing to provide convenience and a more ventilated space to consumers .
As several countries ease their lockdowns and are opening up their economy towards the end of this year , most consumers still continue to shop online . This trend , together with the contactless payments and digital wallet apps are seen to continue to carry out into 2021 .
The pandemic has tested the retail sector ’ s ability to survive in the long run amidst unprecedented challenges . This year , retailers are driven to think on their feet and find ways to cope and adapt to these dynamic changes . To be a retail winner in this new retail landscape , one must be able to restrategise and adapt accordingly to the changes and demands of the market and economic conditions .
For all that , I believe that this ‘ new normal ’ is not really normal until the advent of the vaccines and quick tests . Until then , retail needs to prepare for what the real new normal will be . We must remain optimistic as new developments are already taking place . Better days are coming .
This article is originally published in THE RETAIL WORLD Retailing in Times of Crisis , a year-end publication of the World Retail Congress .
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