PAYMENTS: RETAIL
Ready to pivot: Retailers have shown resourcefulness – but they need payment providers’ help
A key moment for retail? A survey, during the pandemic, of 300 SMEs in the hospitality and service sector, by Valitor and Visa, has revealed a surprising degree of resilience and optimism. But, as one door closes and another opens, those businesses need additional support from PSPs, says Valitor’s CMO Dr Christine Bailey
Back in January 2020, when COVID-19 was still a brief segment at the end of news broadcasts, payment solutions company Valitor spoke to The Fintech Magazine about the disappointing performance of the high street over the festive period and how better use of payments data could help buck this trend. Then the world changed. By the end of March, lockdown had stripped us of most of our retail freedoms. No longer could we simply head out for a carefree coffee with a friend on a Saturday morning, or pop into the shops for an impulse buy on the way home from work. For many bricks and mortar businesses, sales almost entirely ceased overnight. But, as with any crisis, there’s always an opportunity. There’s no denying the retail and hospitality sectors have been hit hard, and footfall on the high street was still down nearly 50 per cent in July, compared to the same time last year, according to the British Retail Consortium. But, while several major names have bitten the dust, many smaller businesses have been presented with a one-off chance to build an online presence that could be pivotal www.fintech.finance
for them, and provide a major source of revenue for years to come. Following the biggest decline in high street spending on record, Valitor and Visa joined forces in the second quarter of 2020 to interview 300 small and medium-sized businesses in the hospitality and service sectors, to discover how they were coping with the pandemic. “Only two per cent of respondents stated that there’d been no impact on their businesses, whereas 63 per cent said they’d had to close temporarily,” says Dr Christine Bailey, CMO of Valitor. “These preliminary statistics may sound bleak, but 65 per cent of interviewees later claimed that the pandemic had actually opened up new business opportunities for them.” Some were fairly obvious – petrol stations did a roaring trade in new stocks of hand sanitiser, while convenience stores saw toilet roll sales explode. After the initial shock, others took the chance for a strategic rethink – altering product lines to cater for a different type of customer; re-planning their spaces to make them COVID-compliant and more luxurious and appealing; maximising hitherto unexploited aspects of their
product or service that spoke to customers’ desire for things that nourished the soul, or played on localness, community, traceability and safety. “Some required a little more ingenuity,” says Bailey. “Sixty-five per cent of respondents said that they had expanded their channels to cater for the restrictions of lockdown, and a common example of this was restaurants providing a takeaway service and allowing customers to come in and pick up their orders. We also interviewed a car dealership that had continued to offer its clients car servicing by collecting their vehicles from their home and then returning them after they’d been serviced.” The Bricks And Mortar Under Quarantine survey, which was conducted by WBR Insights, showed that increasing their geographical reach has proved to be a lifeline for many businesses during lockdown, as has expanding their product offerings. Thirty-seven per cent of interviewees stated that they are now selling new products and services that are more relevant in a COVID world – and not just artisan hand sanitiser and superhero face masks. Issue 17 | TheFintechMagazine
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