There are a billion or more retail dollars up for grabs for the retailers that figure out how to navigate the future of retail. But in my mind, the bigger opportunity is in the ripe pickings available for wholesalers making the leap into retail for the first time. Whatever disadvantages these players may have had prior to the pandemic have now been leveled. There is going to be a continued hesitation to step inside any store that isn’t making it clear that safety is their top priority. But similar to the period of the Roaring Twenties that occurred on the heels of the Spanish flu pandemic, people are going to be ready to do, go, spend, and experience.
Consumer Behavior Has Changed in Surprising Ways
The disadvantage that wholesale brands have always had is that department stores have held all the customer data. For a given wholesale brand that might have been sold at Macy’s, Macy’s would retain that customer data. Macy’s would become familiar with the customers’ habits and trends; the brand, however, would know little or nothing about the end consumer.
Well guess what? Nobody has a lock on customer data now.
Wholesale Brands Have a Level Playing Field
If you’re a wholesaler, the playing field has been leveled. You no longer need to simply operate a department store or an outlet. You don’t have to depend on the dwindling number of department stores in order to thrive. In fact, if you do, you may struggle. While virtually everyone is in the midst of redefining who their customers are, wholesale brands from Calvin Klein to Dyson have the opportunity to pivot during the transformation of retail, whether by opening their own retail stores or by creating popups to test out new markets.
Maximize Existing Opportunities
Before wholesalers can determine the best path forward, they need to assess where they stand now. The picture likely isn’t very pretty, given the number of department store closings and bankruptcies we are seeing and will continue to see. This is also a good time to look at what wholesale competitors are doing – there’s no need to reinvent the wheel if someone has already paved the way for you. Some wholesalers may have an opportunity to partner with retailers, such as L.L. Bean. Others may find that cutting out the retailer and opening their own stores makes more sense. Take a look at what Levi’s and Nike are doing to transform where and how they meet the consumer.
Get to Know Your Customers
Consumer data is a gold mine. By understanding your customers better, you can customize what, how, and where you do business in ways you’ve never been able to before. Yes, it’s taking longer to reopen and stabilize than any of us ever predicted, but there are opportunities to be had if you’re willing to take the chance.