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Retailers with deep connection to their customer communities are best placed to emerge stronger from the challenges wrought by the pandemic.

With pandemic restrictions limiting movement across the world, local shopping strips have emerged as unlikely winners from the pandemic. During the stage 4 lockdown in Melbourne last year, large shopping centres like Chadstone were closed, leaving consumers to embrace their local bakers, butchers and grocers. This trend has continued beyond lockdown, and retailers with a strong community presence continue to thrive.

In the Melbourne suburb of Northcote, there is a visceral hum of activity along High Street. Independent retailers dominate the strip. Vintage clothing stores, cafes, grocers and a local cinema all teem with locals. Shopfronts spill into the street and customers love the ability to discover products they may not find in larger retail environments. Shoppers are passionate in their desire to support local business, a trend which has played very well during the pandemic.

Sydney’s Oxford Street provides a compelling example of how local retail strips can perform counter to the general slump induced by the pandemic. Independent fashion, beauty and homeware retailers offer the variety absent at larger malls like nearby Westfield Bondi Junction. And when the sun goes down the local bars retain punters keen to show their support with an Aperol Spritz or Negroni.

For larger retailers too, connection to local communities has been heightened over the past year. In the United States, the burdens of COVID-19 were significantly greater than in Australia. Yet community-minded retailers have prospered. Home Improvement retailer Lowe’s has committed more than $1 billion in assistance to first responders, small business grants and donations to local communities. CEO Marvin Ellison: “we believe it’s just the right thing to do.” Small business owner Dr Carmin April called her Lowe’s grant a “lifeline” which allowed her to continue to pay staff and purchase much-needed protective equipment.

In addition to providing grants and community support to independent businesses, Lowe’s converted many of its store car parks in suburban and rural communities into drive-in movie theatres during the height of the pandemic. Movies were shown free of charge, with donations accepted to help women-owned and minority-owned businesses. Lowe’s matched all donations two-to-one up to $50,000. These initiatives have been powerful drivers of the brand, and are good business too, with Lowe’s share price doubling since April 2020.

Whilst online retailers lack the opportunities for physical connection enjoyed by bricks-and-mortar, they too are exploring new ways of connecting to communities. Beauty omni-retailer Sephora has sought to generate buzz through the establishment of their Beauty Insider Community, an online hub where users share advice, join like-minded consumers and share ratings on products. There are now more than four million members, with 60,000 directly engaged online at the time of writing this piece. Sephora’s ongoing success owes much to its digital innovations, and shows that community can exist in cyberspace as well as shopping strips.