This year, the world experienced a pandemic outbreak that profoundly impacted the whole business landscape with Target, David Jones, Noni B, Rivers, Millers, Katies, Sussan, Colette, and Flight Centre among others in the process of closing down some stores.
Altogether, up to 1000 retail stores across Australia are expected to shut their doors.
However, there is a glimmer of hope in these uncertain times.
Iconic Australian names, such as RM Williams, may make a comeback as they slowly find their feet and navigate through this challenging business climate.
Research, including that conducted by Curtin University during the pandemic, shows consumers tend to favour Australian companies, perceive them as more relatable, authentic and genuine.
This willingness to support local businesses is amplified during a time of crisis. Our recent research shows that a driving factor toward this choice is consumers' innate desire to look for safe and familiar options.
As local brands often emanate trust, familiarity and authenticity, consumers will elect to purchase more local products over foreign alternatives, even if they have to spend a little more. Our research also shows, this patriotic tendency to support local is even more profound when consumers are simply reminded through the media of the global threat posed by the pandemic.
Australian iconic names, however, cannot merely rely on consumers' favouritism towards buying local to weather the significant and long-lasting impact on the business landscape.
The actions that companies take during times of crisis have a major impact on brand trust and equity. Insincere use or abuse of consumers' support and trust can even backfire. It is therefore important local players show genuine concern to their consumers, be part of the community, stay relevant, and most importantly, uphold consumers' expectation of quality and authenticity.
Consumer behaviours are merely one piece of a bigger challenge faced by Australian brands. Their success will depend on the resilience of their supply chains including their ability to absorb sudden disruption of their production as well as the timely provision and optimisation of different digital channels and accompanying services such as home delivery.
It is still early days for the recovery of the Australian retail sector. However, the ongoing support of local iconic brands is certainly a much-needed band-aid as we all await a viable and effective vaccine.