KFC launched a viral new fried-chicken-and-doughnut sandwich earlier this year.
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Happy New Year! We’ve finally made it.
The year 2020 featured a global pandemic, an economic downward spiral, and an unforgettable presidential election. In the world of retail, 2020 was similarly grim, with a massive wave of store closures and industry bankruptcies defining much of the shopping landscape throughout the year.
But, believe it or not, 2020 also had its good moments.
Today, we’ll take a look at the biggest events in retail in 2020, as we celebrate the turn of the year with a special edition of Insider Retail. We’ll go through the ups and downs of 2020 – from store closures to the acceleration of e-commerce – and try to predict what’s to come in 2021.
Next week, we’ll be back to our regularly scheduled programming. So if you haven’t already subscribed, take the first step in making your 2021 much better than 2020 by clicking here and subscribing.
Lastly, from all of us here at Insider Retail, thanks for sticking around throughout 2020! Here’s to a happy – and hopefully more normal – New Year!
The pandemic had a polarizing impact on retail. While some companies endured major losses due to store closures and mandated stay-at-home orders, others were galvanized by a boom in panic-buying and e-commerce.
The winners: Big-box chains like Walmart, Costco, and Target saw major sales gains in-store thanks to their status as “essential businesses,” which allowed them to stay open when other retailers and restaurants had to close. In addition, digitally native businesses like Amazon and smaller direct-to-consumer companies witnessed surges in sales as well – particularly those focused on athleisure wear. The same can be said of at-home fitness companies like Peloton and Echelon.
The losers: Many restaurants, apparel chains, and department stores suffered large amounts of damage last year. About 40 major retailers filed for bankruptcy in 2020 and more than 11,000 stores have closed, according to commercial real estate research firm CoStar Group.
People dine in plastic tents for social distancing at a restaurant in Manhattan on October 15, 2020.
Angela Weiss/AFP via Getty Images
Forced closures and new safety regulations pummeled the restaurant industry in 2020.
Twelve restaurant chains filed for bankruptcy last year in the wake of the pandemic. In total, the National Restaurant Association said about 110,000 restaurants locations have closed.
Many chains were forced to quickly adapt their business models to stay afloat. Changes included menu cuts, increased automation, and a new reliance on third-party delivery services.
According to some experts, these changes will likely persist in a post-pandemic world.
Rafael Henrique/SOPA Images/LightRocket via Getty Images
With stores temporarily shuttered early on during the pandemic, Americans turned to online shopping en masse for everything from essential goods to comfort buys. In November, a record-breaking 100 million people shopped online on Black Friday, with the percentage of people exclusively making purchases online increasing 44% from 2019. Looking ahead, experts anticipate e-commerce to only continue to grow in the new year.
The rise in e-commerce boded especially well for direct-to-consumer brands, several of which reported massive growth in 2020. With limited brick-and-mortar store options and the fear of spreading the virus running rampant, shoppers sought out alternative ways to procure items like groceries and toiletries, flocking to companies like Imperfect Foods and Thrive Market. DTC brands specializing in everything from alcohol and feminine products to pet food and furniture also saw major gains as the year progressed.
While Peloton emerged as one of the clear winners of the pandemic – with demand for its stationary bicycles and treadmills growing so high it struggled to keep up – fitness brands specializing in everything from at-home yoga to virtual kickboxing also reaped the benefits of Americans being forced to stay home and skip the gym.
And while the future of gyms and group fitness remains uncertain, many anticipate the virtual fitness trend is here to stay, as the pandemic makes lasting shifts to American lifestyles. According to the advisory firm Lincoln International, the global digital fitness market swelled to an estimated $27.4 billion in 2020, up 32.6% from 2017.
Meanwhile, traditional brick-and-mortar gyms and studios felt the strain, leading to bankruptcies from major fitness companies like Gold’s Gym, 24 Hour Fitness, YogaWorks, and Flywheel.
