Excerpt from webinar, Retail Location Strategy in a COVID-19 World, on May 13, 2020
Reposition: Shift from In-store to Other Channels
Devon Wolfe – Senior Vice President of Analytics, Tango:
“Well, I think it’s very interesting how this is all working out. Just sitting and thinking about my own behavior in this whereas in the beginning, I was very happy to get Amazon deliveries or something else like that, but now I’m getting antsy. Actually, this whole Target thing of go pick up at home, you’d think that you’d rather have it at your doorstep. But with the way people are right now being sheltered so much, actually going and stopping and picking it up and not having to go in the store, that’s not a bad thing. Those are the kinds of trends that we’re going to see as we go forward.
“Now, what that’s going to mean for store networks is that well, first of all, we’re seeing customer groups that we never saw do this doing this. We see people over 65 using Zoom, buying online, doing all kinds of things they weren’t doing before, and that’s going to have a giant change in how things are going to work. And it’s going to change store networks.
Then I think the other thing that you’re going to see happen is that retailers in the past have worked off a market-share model, which is I want a network of stores that’s going to blanket the market so that people when they make a home-to-store trip or a work-to-store trip or whatever it might be, I’m near where they want to be. That’s going to change to more of a coverage model where they are going to rationalize the number of stores they need to have that footprint in the market but yet make it close enough that they can fulfill their online orders; they can do all those things. So reduce the number of stores in the market and use omni to back end or back up the rest of the sale. That’s going to change as well in this world. Again, as we’re starting to model this, we’ll be looking for those shifts and trying to help our clients be able to make those adjustments.”
David Srsic – Senior Director of Global Marketing Planning, Dunkin’:
“That’s changing the type of real estate we need or can change it in the future, but we’re seeing tremendous improvements and gains by leveraging that and stuff we’ve already planned, but other things we’ve accelerated through this current situation.
“Think about a location that’s drive-through only. Maybe they have a little walk-up window or a vestibule you can go in and order, but there are no tables whatsoever. Those are like infill situations. When you think of like, Devon, I think you mentioned an optimization model of how we network our stores across the market, we’re going to have to consider that what is this type of store? This may be freestanding… and we did too some degree, right. This may be freestanding with drive-through location, whereas this one was inline with no drive-through.
“Now we’re going to have to have drive-through onlies and different types where we’ve also been deploying carts where you just tow them in and you drop it for part-time. We’re going to have to look at that and where those locations are. Not that we didn’t, but we’re going to have to think about it even more. We don’t treat each store equally as far as the pull demand that it has with the people around them and so on.
“Even the hours that that store operates, we’re going to have to look at that. Some stores are open 24 hours. Some stores close pretty early regardless of the chain. If they were in an employment environment like a CBD or something, they might shut at 7:00 pm. Where you get closer to residential, you might be open till 10:00 pm because there’s activity still going on, coming home from baseball games, or whatever it is with the kids, you’re picking up something.”
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