Although many people are acting as if the Covid pandemic is over, it isn’t. Reporter Erika Edwards (@erikaedwardsnbc), and her colleague Dr. Akshay Syal, observe, “Hospitals nationwide are preparing for another winter with Covid — the first one that’s also expected to include high levels of influenza and other respiratory illnesses that have simmered quietly in the background for the past two years. … The convergence of viruses is hitting health care systems as they’re forced to reckon with staffing shortages that worsened during the pandemic.”[1] Journalist Tina Reed (@TreedinDC) adds, “Fears of a wintertime ‘tripledemic’ have prompted warnings to get flu shots and reformulated Covid boosters — but there are no such options for the third pathogen in circulation: respiratory syncytial virus, or RSV.”[2] Fortunately, she reports Pfizer is working on a vaccine for RSV. Unfortunately, as important as vaccines are, they aren’t always guarantors of good health.

Syndicated columnist Kathleen Parker (@kathleenparker), despite having received two coronavirus vaccinations and two boosters, has contracted Covid twice. She writes, “I’ll tell you what’s everywhere — Covid-19, and it smells your fear. Don’t let anyone tell you otherwise, and don’t deceive yourself into thinking we’re all done with it. We’re not by a long shot. Despite our best efforts to thwart the virus that leads to Covid — and despite my own adherence to best practices — it got me again. … If I were you, I’d mask up and get all the shots.”[3] Although Parker offers good advice, I’m not naïve enough to believe the majority of Americans will follow that advice. What that means is that a good number of people will continue to get sick. It also means consumers trying to avoid getting sick while shopping will continue to favor options like buy-online pickup in-store (BOPIS) and curbside delivery. As a result, journalist Jaclyn Peiser (@jackiepeiser) reports, “Major retailers are leaning into ‘omnichannel’ shopping options to draw in customers.”[4] She adds, “Curbside pickup, BOPIS and other ‘omnichannel’ approaches meant to make shopping seamless no matter the point of purchase — in-store, by phone, app or desktop — were already gaining traction before the coronavirus crisis took hold in early 2020. But the pandemic forced retailers to adapt quickly to new safety concerns and social distancing norms, and now there’s no going back for many consumers: 33 percent of adults younger than 50 who started using curbside pickup during the pandemic say it’s a habit they expect to continue, according to a study from the Associated Press-NORC Center for Public Affairs Research and the SCAN Foundation.”

Omnichannel Challenges

BOPIS and curbside pickup are great options for people with disabilities, seniors, and individuals still wary of contracting contagious viruses; however, those options are often more expensive for retailers. Nevertheless, retail sector journalist Ben Unglesbee (@Ben_Unglesbee) reports, “Store pickup of online orders grew by triple digits amid the pandemic. Retailers are now scrambling to become more efficient sellers across channels.”[5] If you’re wondering why curbside pickup and BOPIS are expensive options for retailers, Unglesbee explains:

“For most of the industry’s life, retail had a plentiful supply of labor for critical tasks that was absolutely free. The source of that unpaid labor? Customers. Shoppers drove the last mile to and from their house to the nearest distribution hub (in this case a store). They paced the aisles and picked the merchandise from the shelf. They walked products from shelf to point of sale and then to their car before driving off, perhaps to another store. It was a sweet deal for the retailer, which also drew a major marketing benefit from the perpetual billboard of a storefront. Among all the other things that COVID-19 has upended, that operating model too now might have changed to a large degree, forever.”

And inflation isn’t helping. To counter increased costs, Peiser reports, “Retailers ranging from major department stores to local hardware stores are leaning into the demand. But some may take it a bit further — by adding fees.” That’s a move that may backfire during inflationary times. Of course, BOPIS and curbside pickup are not the only omnichannel options available to retailers and consumers. In the beginning of the e-commerce era, brick-and-mortar retailers tried to fight back. They loathed so-called “showrooming,” where consumers came into stores to check-out products then went online to buy them at lower prices. Retailers soon learned they were fighting a losing battle and adopted the old adage, “If you can’t beat them, join them.” The staff at The Wise Marketer explains, “Call it détente, call it a truce, call it Channel Wars Part III. Whatever you call it, call it real. Thanks in part to the ongoing Covid-19 pandemic, there’s been a powerful blurring of the lines that separate these once-hostile camps.”[6]

This détente rapidly focused retailers on the benefits of omnichannel operations. McKinsey & Company analysts report, “Retail has experienced more change over the past five years than in the prior 50. Indeed, the pace of change accelerated throughout the Covid-19 pandemic as retailers adapted to changes in consumption, channel shifts, and rising customer expectations around speed and convenience.”[7] They note that there are many benefits to omnichannel operations as well as a number of challenges that still must be overcome. Among those challenges are: Inventory accuracy; SKU complexity; demand forecasting; picking costs; and, execution quality. All of these are supply chain challenges.

Concluding Thoughts

There is little doubt that omnichannel operations are here to stay and that retail outlets that can master omnichannel operations will gain a significant competitive advantage. Deloitte analysts, like McKinsey analysts, insist that supply chain operations must adapt to this new retail environment. They explain, “With the coronavirus pandemic came new consumer expectations and shopping behaviors. Those changes require wholesalers and retailers to transform their ecosystems and supply chains for the future.”[8] They conclude, “Consumers are more focused on e-commerce services and experiences than ever before. Educated customers are comparison shopping for products, prices, and associated services, including free shipping and returns, rapid delivery, and simple return policies. According to a Deloitte analysis, customers to shop from a brand that provides a good website, delivery, and return experience — putting greater pressure on the supply chain to work smoothly. Given this environment, brands that prioritize their e-commerce capabilities can gain a competitive edge.”

There are still omnichannel challenges to overcome — among them being the high rate and cost of returns. Consumers have taken advantage of liberal return policies and I expect that to change over the coming year. In other areas, however, retailers have made great strides in their omnichannel efforts and those advances will continue to pay dividends as long as viruses affect consumer behavior.

Footnotes
[1] Erika Edwards and Akshay Syal, “U.S. hospitals brace for an unprecedented winter of viruses,” NBC, 10 October 2022.
[2] Tina Reed, “RSV vaccine search could hit third piece of ‘tripledemic’ threat,” Axios, 1 November 2022.
[3] Kathleen Parker, “Put your masks back on, please,” The Washington Post, 28 October 2022.
[4] Jaclyn Peiser, “Curbside pickup is here to stay, and retailers are going all-in,” The Washington Post, 28 August 2022.
[5] Ben Unglesbee, “The omnichannel age is here — and it’s expensive,” Retail Dive, 5 April 2022.
[6] Staff, “Digital Détente: How Omnichannel Retail is Fostering a Truce Between Online and In-Store Customer Engagement,” The Wise Marketer, 15 April 2021.
[7] John Barbee, Jai Jayakumar, and Sarah Touse, “Retail’s need for speed: Unlocking value in omnichannel delivery,” McKinsey & Company, 8 September 2021.
[8] William Kammerer, Curt Bimschleger, and Maura Leddy, “E-Commerce Capabilities Drive Competitive Advantage,” The Wall Street Journal, 4 March 2021.