Since the start of the global pandemic, COVID-19 has affected nearly every aspect of people’s lives, and in the years since, its impacts still linger, particularly in the realm of shopping.
The pandemic contributed to the demise of numerous large department retail establishments, like Bed Bath & Beyond and JCPenny which sell ready-to-wear clothes, accessories, and furniture. COVID conversely accelerated the growth of big box retailers, like Target and Walmart, which sells groceries and basic household items.
The number of people who shop online has dramatically increased since the pandemic. According to Dr. Anand Krishnamoorthy, Associate Professor of Marketing at UCF, approximately 13% of shopping was done online prior to COVID-19. That percentage increased to almost 20% as a result of COVID.
“The department stores, the ones that are hurt the most, have been those that were struggling even before COVID,” Krishnamoorthy said.
In 2019, Target made $77 billion in revenue, which increased to $109 billion in 2022. The overall revenue of department retailer JCPenney was $11.2 billion in 2019 and $9 billion in 2022.
Big box stores such as Target and Walmart have done extremely well during and after COVID-19 because of their ability to change their products to meet customer needs. Big box stores that sold cleaning and hygiene products gained a lot of customers because these essentials were needed at the time.
“Walmart and Target are examples of discount stores,” Krishnamoorthy said. “These stores have done fairly well, but the other type of retailer that has done fairly well is the off-price or bargain bin type stores. For example, Ross comes to mind or some of these other stores that focus on the price-sensitive consumer.”
Black Friday was one event that retail establishments used to count on. The night and morning before Black Friday used to be quite profitable due to the large number of customers it brought in. After struggling through May, June, and July when there was no major reason to go shopping, Black Friday boosted retail companies’ income.
“Most of these [department] stores that were struggling before and may have filed for bankruptcy now used to depend a lot on sales during Black Friday,” said Krishnamoorthy.
With social distancing norms in place and a shift towards digital purchasing, the retail industry is at a defining moment, that will significantly alter the way consumers shop.
Traditional brick-and-mortar stores only sell products in physical locations and people can only shop during working hours, but, when in-store shopping people get the full experience of the item. With online shopping platforms, customers can shop at any time of the day or night, the downside being that they will have to wait for their products to be delivered and the product may be faulty.
“I feel like the workers always ask you if you need help all the time and it’s kind of awkward,” said eighth-grader Kensington Reuss. “Stores sometimes don’t have what you need. I like shopping online because some stores have a separate online store where they have things they don’t have in store. So I feel like I have a better variety of choices and there’s more to shop from.”
According to a survey from Statisa.com, approximately 43 percent of consumers in the United States said they would prefer to shop mostly online rather than in-store, and 27 percent prefer in-store shopping. Some department retailers that have been struggling have made their stores completely online. However, online shopping is not without its flaws, fake websites and privacy are just some of its downfalls.
“I feel like online shopping is kind of hard because you don’t really know exactly what the product is going to look like,” Reuss said. “ But I like shopping online because some stores have a separate online store where they have things they don’t have in store. So I feel like I have a better variety of choices and there’s more to shop from.”
To put it simply, during the COVID-19 pandemic, many department retail stores experienced major declines in income and in-store shopping while online shopping on the other hand, has seen a major influx of money and customers.
“While online sales will continue to go up, back-to-store shopping during the holiday season, etc., is something that is likely going to see a slow uptake back to pre-COVID levels, coming forward,” Krishnamoorthy said.
