Winter is coming, but will a surge in the Coronavirus accompany it?
As the second wave of Coronavirus infections surges across Europe, we should definitely be focusing more on what will happen this autumn and winter in retail sales. This is especially important considering that many experts have warned that the virus’ spread can be accelerated in colder, darker months, as well as when we spend more time indoors together. One particular survey highlighted that the virus can survive outside the body for up to ten times as long in colder conditions.
Of course, we now know a lot more about this virus than we did half a year ago and this has encouraged people to implement smart measures like washing hands, social distancing and the wearing of masks in order to slow the virus’s spread. But with more and more people tiring of the restrictions and flouting basic rules, at some point the only way to really stop continued spread is another lockdown, despite most politicians’ continual denials.
Why countries are so desperate to avoid a second lockdown, and its effect on sales, the economy and the general public
Of course, no politician in power wants to tell their voting public, just as people are getting used to more freedom, that in a few months or weeks, everyone might have to return to more restrictive measures. Politicians don’t want to make people worry even more than they already are, especially since the whole economy depends on getting people to spend. Consumers tend to spend more when they feel their lives look more rosy.
Which brings us to Black Friday which has become a major moment in the lives of shoppers over the last decade.
How companies are preparing for this Black Friday logistically
So many things have changed since the last year. Most retailers are already looking forward and preparing for a very different Black Friday this Autumn. Regardless of how much money is spent, it appears that this year’s sales will mainly take place online.
Since the lockdown in March, there has been a real increase in online shopping traffic, with years of growth coming in only a few short weeks. This first led to a lot of logistic problems as demand for goods soon overpowered availability and distribution. This led companies like Amazon to scale back traffic acquisition, whilst they expanded their workforce to accommodate for the increased demand. Amazon has continued to employ thousands of people across the world, and now plans to hire over 100,000 workers in the US and Canada alone as they get ready for Q4 sales.
Amazon is also buying and building new logistic centres, software and hardware, and expanding their program of automation.
But Amazon isn’t alone in building up its logistics to cope with an ever increasing demand for online goods, and this has led to some interesting developments. Demand for warehouse rentals was already on the rise, but since March, prices have gone through the roof as retail and postal firms try to get whatever space is available as they prepare for a very busy future online. In fact, warehouse rentals seem to be the brightest light in a very uncertain future for rentals in general. Office spaces and inner city real estate values seem to be falling, as more of us work from home.
Another industry which was challenged in a totally different way was the aviation industry as the travel sector bottomed out. Luckily it managed to earn back some of its losses through increased demand for cargo. During the pandemic even normal planes were being filled with goods as the need for health-related items dramatically increased when governments, states and citizens scrambled to get masks, PPE and sanitary products. Of course, this demand was strongest during April and May when less planes were flying and national resources were low. But even as we have returned to a more normal life, demand for cargo is still surging due to the increase in online orders and consumers that want fast delivery. DHL is so confident of future demand that it has just ordered a new fleet of aircraft to strengthen its already vast delivery system.
How companies are preparing for this Black Friday digitally
Google Cloud is increasing its servers as it expects online sales to skyrocket during Black Friday sales, on top of this many brands and retailers have admitted that without a vaccine it’s going to be really difficult to hold a massive sales event at street level. No retailer wants to see their street stores in the news linked to a super spreader event. We all remember those classic Black Friday scenes of people crowding into stores like sardines, trying to get amazing doorbusters, and then standing neck to neck together in long queues again as they wait to pay for their bargain items. This year must look different.
Thus, many retailers are already planning to focus on bringing traffic to their online stores. Foreseeing that this year’s Black Friday shoppers will be glued to their screens, waiting for the sales to begin, and not stuck in crowds queuing. Retailers are also indicating that the Black Friday sales period will probably be extended, so as not to cause crowds on the streets and an overwhelming surge of traffic online that will again become hard to logistically support.
How could this Black Friday turnout?
Even as so many retailers, brands and logistic firms prepare for a surge in online sales this Black Friday, there are still many uncertainties. Preparing for different possible scenarios and estimating how they could affect the sales themselves is essential. Here are three scenarios that could come true in some way or form:
Scenario one: A feel good Black Friday
As we reach the start of Black Friday sales, and the promise of a vaccine becomes more hopeful, we could also see a surge in buying as people’s spirits are lifted and the future becomes more bright. Consumers visit both offline and online stores and even start to book holidays in advance as they look forward to a better 2021.
Scenario two: Black Friday Blues
The start of the Black Friday sales coincides with increased worry, as infection numbers and unemployment continue to rise as winter approaches. There is no lockdown, but there are massively reduced numbers of shoppers on the streets as brands and retailers encourage shoppers to use their online stores and consumers try to avoid public spaces.
Online shopping and discount sites see a surge in traffic as customers use the sales period as an opportunity for a little retail therapy and a way to afford those necessities required for an even worse winter.
Scenario three: Black Friday under lockdown
Black Friday sales take place only online as many countries go into strict lockdowns to slow the ever increasing number of infections. Lots of retailers and brands try to avoid a sudden surge in online orders and the logistic chaos thereafter by extending their normal Black Friday sales period.
However, retail traffic is very high and we see a repeat of what happened earlier in the year, as items that are either related to health, fitness and life at home jump in popularity.
Whatever the scenario, it’s becoming more obvious that this Black Friday will be very different and very digital
The three scenarios above are just the tip of the iceberg of possibilities in a year that has seen changes that no one could have fully envisioned just 12 months ago.
Here is what we do know:
- Scientists’ predictions of the second wave of COVID-19 just as we start Autumn is coming true.
- Companies are positioning themselves to benefit from an especially digitised Black Friday and have already made preparations including:
- Amazon’s recent and great expansion of all its logistics from warehouses to workforce.
- DHL’s purchase of aircraft to empower its cargo service.
- Google Cloud increasing servers to ensure uninterrupted online shopping for their e-commerce partners.
- Retailers are hinting at an extended Q4 sales period and emphasis to bring more customers online where it’s safe to shop.
- And finally, warnings from Western leaders that a second lockdown could become necessary have begun.
So one thing that is certain amongst all the uncertainty is that there will be more online shoppers this Black Friday.