COVID has revolutionised China’s retail experience; there are learnings for Australia

New research from a major retail and dining precinct in China shows retailers who adopt new ecommerce strategies are reinvigorating the city-centres main streets. Image credit: Getty

New research from a major retail and dining precinct in China shows retailers who adopt new ecommerce strategies are reinvigorating the city-centres main streets.

The precinct in Wuhan's Jiang Han Road, similar to Melbourne's Bourke Street or Sydney's Pitt Street Mall, has undergone significant transformation, with new research revealing local business owners are overhauling the way shoppers interact with their brick-and-mortar stores.

Using comparison data between 2016 and 2022, Professor Sun Sheng Han from the University of Melbourne, and researchers from Shanghai Jiao Tong University and Wuhan University discovered that while digitally savvy consumers were buying clothing and food online, they were visiting the main streets to take photos and videos to boost their online profiles in the stores' social media-friendly showrooms.

"The stores that are adopting these new retail strategies are the ones staying open and growing while others around them are closing. While consumers are out and about, shopping and socialising on the high street, they are actively ordering items online. They use the store for taking photos and videos of themselves with the new products, then post their experiences on social media" said Professor Han, from the Faculty of Architecture, Building and Planning.

In response to changing consumer behavior, the research also showed visual merchandisers were changing their shopfronts to mirror smartphones, displaying their goods on the vertical axis to fit inside the frame of shoppers' smartphone cameras. The value of a retail lease in Jiang Han Road is now determined by the height of the shopfront as opposed to the width of the floorspace.

"A successful rebound for city centres depends on a robust digital offering. Small businesses with brick-and-mortar shopfronts must meet shoppers where they are, which is online, as well as in-store, but in a new way."

Professor Han said the broad range of strategies used by store owners in the study could be adopted by Australian businesses still trying to adapt and grow following COVID and the recent cost of living crisis.

"Main streets and city centres around the world are hurting. What Australia can learn from our research in China is that while the number of retail shops has dropped significantly, small businesses who embraced influencers and digital platforms by adapting their shopfronts to be more social media-friendly can succeed."

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