Retail
The retail sector has undergone a global revolution in recent years as the market has been impacted by internet shopping. Yet whilst shopping centers and high streets around the world have been attracting fewer and fewer visitors each year, the Israeli ‘mall culture’ was booming – until COVID-19. According to governmental data, 77% of the Israeli public prefers the mall to the commercial street and the market, seeing them as the "home" of the brands (while the market and high street are identified with value products). For 83% of the public, it is customary to go to a regular mall about four times a month, with most of them staying over an hour during each visit.
The government restrictions on operability and the number of people allowed in stores, malls and restaurants are constantly changing. As elsewhere in the world, the resulting frustration, fear and uncertainty among both retailers and shoppers have accelerated the upward trend in the popularity of e-commerce. As the ease and speed of online shopping and delivery of goods continue to improve, more and more traditional shoppers will find themselves being “converted” to e-commerce. Many vendors that had never explored the world of online selling have now begun to enter this arena to offer their products to a wider and evolving customer base.
According to governmental data, 77% of the Israeli public prefers the mall to the commercial street and the market, seeing them as the "home" of the brands (while the market and high street are identified with value products).
Such a shift will significantly change the future landscape of brick and mortar retail. The systemic effects will influence the value of commercial centers, malls, parking operators, and maintenance and management service providers. Physical retail is far from dead, but retail models are evolving towards “omnichannel” operations which will require adjustment to store portfolios and logistics chains. This offers opportunities as well as threats, and many Israeli tech companies are at the forefront of the evolution in this sector.
Some sectors rate faring better than others do, with pharmacies, grocery chains, fitness equipment retailers, and electronic stores continuing to benefit from the current market conditions. In particular, due to concerns around social distancing and avoiding closed spaces, shopping center or “open-air” retail complexes, should see higher foot traffic than enclosed malls.
