FEATURE
After pandemic , what ’ s next for retail apart from contactless ?
By : Terence Ng , Tofugear
The Philippines , being one of most affected countries due to the spread of covid-19 virus , has seen massive changes to consumption habits throughout the country . To succeed in the retail game , there is much more needed apart from a pure contactless approach to cope with sanitization . From what is observed so far , Filipino brands and retailers can consider enabling cashless transactions , adopt a more diversified channel mix and introduce more occasion-relevant offerings . As for mall operators , they should also change their purposes over time .
Brands and Retailers Need to Go Cashless
Filipino brands and retailers would need to adapt to the latest consumer appetite in paying for goods and services . A recent study “ Consumer Payment Attitudes ” conducted by Visa Philippines indicated that Filipinos are generally interested in cashless transactions - almost 4 out of 5 respondents said they are willing to give it a go , citing convenience , speed , and “ an innovative way to pay ” as motivations .
Not surprisingly , Filipinos are already going cashless across several e-commerce categories - forty-nine percent choose cashless transactions on supermarket purchases and 45 % on fast food purchases , according to the same study . Indeed , the covid-19 outbreak has accelerated the adoption of cashless payment solutions by top quick-service restaurant ( QSRs ) chains in the country , namely Jollibee , McDonald ’ s , and KFC which have all adopted PayMaya ’ s end-to-end digital payments solution ‘ One by PayMaya Point of Sale ’ devices for in-store and drive-thru . It is expected more brands and retailers may follow suit in the near future to provide consumers with more convenience .
Diversify channel mix
The outbreak of covid-19 has massive impacted traffic to physical retail in the Philippines , with visits to retail establishments across the Philippines falling an average of 55 % between February and July , according to Google ’ s Community Mobility Report . This means brands and retailers can no longer rely on physical channels and should expand their online reach soonest . Volvo Philippines , at start of the pandemic , recognized customers ’ needs and launched a concierge service that offers remote sales and service support via online and social media channels — making service appointment or a scheduled test drive or viewing easier . For brands and retailers to catch up on the digital race , they can capitalize on Alibaba Group ’ s launch of the Alibaba Cloud Philippines Ecosystem Alliance in July 2020 , which aimed to speed up the digital transformation of businesses in the country .
Apart from online , in physical space brands and retailers can also consider partnering with alternative channels to maximise their reach to consumers . Take MUJI Japan as an example , it partnered with convenience store operator Lawson in June 2020 in response to the trend of people increasingly purchasing basic necessities at convenience stores in Japan , and made its products available for purchase at Lawson stores . With the growth of small store formats such as Family Mart , Lawson and Alfamart on the rise in the Philippines , this poses promising opportunity for Filipino brands and retailers who aim to sell basic necessity goods .
Consumers Need Relevant Offers
The pandemic has caused Filipino to work at home more often and consume more groceries at home . According to Facebook , citing a study by Bain & Company , at least four of 10 digital consumers in Southeast Asia were found to have spent more on packaged and fresh groceries online this year , with at least 80 % of them indicating their intention to continue buying groceries online in the future . Since start of the pandemic , some brands and retailers are recognizing this consumer trend and responding accordingly , including Jollibee offering to deliver ready-to-cook items since late March 2020 . Food-delivery service Foodpanda in the Philippines , to increase relevance of its offering , has also expanded into grocery deliveries by partnering with major retailers such as 7-Eleven and enabling consumers to place orders from shops and track from the Foodpanda app through its “ Shops ” function .
Malls are No Longer Retail Only
The Philippines used to be a mall country where people like to socialize at . Yet , owing to covid-19 , traffic to retail establishments has drastically dropped as mentioned above . For mall operators to remain relevant in such turbulent times , they will need to change the way of utilizing their assets from offering purely retail goods and services . Since start of the pandemic , multiple Filipino mall operators made changes , or have plans on changing their positioning in response to the dominance of e-commerce platforms such as Lazada and Shopee in the country :
Ayala Land is looking at making parts of its malls as a storage facility SM Supermalls is building an e-commerce platform that would turn its malls into fulfilment hubs . Megaworld Corporation , which operates 24 malls , has started building an e-commerce delivery app called Pickaroo .
Meanwhile , Vistamalls , which has more than 20 locations , has introduced a logistics service that not only supports its tenants , but also accepts service requests from small businesses outside its malls .
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