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Economy

Retailers And The Pandemic: Adapt Or Die

Consumer habits shifted dramatically as people sheltered in place. In-person shopping is picking up again, but everything's still in flux for sellers, who will have to adapt or say 'adios.'

The La Vega Central market in Santiago, Chile
The La Vega Central market in Santiago, Chile
*Roberto del Río

-OpEd-

SANTIAGO — The era of COVID-19 could also be called the sink-or-swim era, at least when it comes to retailers, both large and small. The pandemic has caused consumer habits to change quickly and in ways nobody expected. Companies, as a result, must either move quickly and adapt, or sink.

Today, the what and the how in mass-scale consumption has become an uncertain realm, especially in Latin America, which has yet to see any light at the end of the tunnel in this prolonged crisis.

In retail, the most obvious adaptation has been to transition online. The speed at which businesses have done this exceeded any prediction that might have been made, and in Chile this was because some 229,000 households suddenly began buying online. Driving the digital transition were quarantines that blocked or limited movements, including supermarket shopping, but also people just wanting to stay home because of health concerns.

Sooner or later we shall go back out and face the "new normal," which means shops will reopen and there will be a new, mass consumption scenario. How will consumers return to shops? What will they buy, how and why? These are some of the questions the industry, if it hopes to capture this new consumer, must grasp fast and answer.

The what and the how in mass-scale consumption has become an uncertain realm.

In the past six months, mass consumption has seen some more specific changes. In Chile it began in March with panic buying ahead of an imminent lockdown, with families wanting to assure supplies for some time ahead. As months passed and restrictions increased, buyers calmed down. Their purchases have now become highly rational (no more window shopping) and broadly based on replacing basic home supplies. The consumption of meat and dairy products and packaged foods has increased. Perfumes, alcohol and drinks are down, and buyers are looking for what they need, at the best price. A consumer study by the consultancy Kantar has shown that the incomes of 67% of shoppers has dropped in the pandemic.

This can be an opportunity for the big chains in the post-pandemic world. Spending on household and cleaning products will recover its ordinary levels and a new budget space will appear for other consumer goods that saw a recent fall in demand. The return to the "new normal" will feel like freedom, which will be evident in renewed visits to shops and supermarkets. This means the point of sale will once more become the frontline, and strategies on marketing and brand visibility will be crucial to cashing in on post-pandemic consumer habits.

In present conditions it is difficult to see consumption rising again in the short term, and there's little doubt that big consumer sectors will inevitably see a drop in sales. But with the right tools like Big Data and data analyses, retailers can respond fast to these big changes. With information reading systems, retail businesses can spot changing conducts, maintain their supply chains and ensure they're not left out of the market.

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FOCUS: Russia-Ukraine War

The Dead And Disappeared: A Village Emerges From 72 Days Of Russian Occupation

Russian forces have been pushed out of the area around Kharkiv. Villages that were occupied for two months are free once more — but utterly destroyed. And thousands of people have disappeared without a trace.

Kharkiv and the surrounding villages faced weeks of constant Russian shelling.

Alfred Hackensberger

TSYKRUNY — Andriy Kluchikov uses a walking stick, but is otherwise fairly sprightly for a 94-year-old. Under his black wool hat, Kluchikov seems fearless as he surveys his hometown in northeastern Ukraine. “The missiles don't scare me,” he says with a smile. “I have slept in my own bed every night and never went down into the basement.”

As for the two-meter-wide bomb crater that has appeared in his garden, between the vegetable patch and the greenhouse with its shattered plastic roof, Kluchikov almost seems proud. “No one can intimidate me,” he says. “Not even the Russians.”

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In the early days of the war, in February, Russian artillery almost completely destroyed this village of Tsyrkuny, near Kharkiv, Ukraine's second largest city. Only a few houses, including his own, were left undamaged. Shortly afterwards, Russian troops marched into the village and occupied it for 72 days. It was not until early this week that the Ukrainian army was able to liberate Tsyrkuny and many other areas to the north of the country’s second-largest city, Kharkiv.

It is the Ukrainians’ most successful counter-offensive so far. They are thought to have pushed the invading troops back almost to the Russian border. “The offensive is gaining momentum,” according to the independent American thinktank Institute for the Study of War. “It has forced Russian troops on the defensive and has successfully alleviated artillery pressure on Kharkiv City.”

In the modern city of Kharkiv, home to around 1.5 million residents, the relief has been palpable over the last few days. Restaurants and cafes have reopened. People are walking and riding bikes in the parks, and couples are strolling hand in hand, enjoying the warm spring sunshine. You can still hear the artillery, but it is now many miles away.

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Central to the tragic absurdity of this war is the question of language. Vladimir Putin has repeated that protecting ethnic Russians and the Russian-speaking populations of Ukraine was a driving motivation for his invasion.

Yet one month on, a quick look at the map shows that many of the worst-hit cities are those where Russian is the predominant language: Kharkiv, Odesa, Kherson.

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