COVID-19 forces local brick and mortar retailers into e-commerce

Many Twin Cities boutiques have until now either put online commerce on the back burner or downright rejected it because they consider face-to-face customer service as their edge.

The shutdown of stores because of the coronavirus stay-home orders has changed that, and some have found a new market because of it. Others believe they have at least kept their brand in customers' minds.

Online shopping has increased by nearly 40% since the pandemic began, according to an online study by digital-marketing firm Influence Central of more than 700 consumers.

Tyler Conrad, who owns seven GoodThings storefronts in the Twin Cities, initiated online sales because of the pandemic. Besides the store's website, he features feeds through Facebook and YouTube.

He expects the change to be permanent.

"Will we continue online? It's an overwhelming yes," he said. "We're shipping all over the country now. It will be like another store. I did a video with my 11-year-old daughter demonstrating Eggmazing egg decorating kits on Facebook. The response was crazy and we had only a few left."

Still, online sales are barely paying the overhead to keep his seven storefronts — and the online operation — profitable. GoodThings has had only 10% of normal revenue since the stay-home order.

The learning curve makes it difficult. "With Facebook Live we have to have additional staff to answer questions. I'd like to do more videos, but then we have to manage stock and make sure the items get uploaded online," Conrad said. "We need more staff to handle what we're trying to achieve."

Consumers used to free shipping and lower prices than in stores create more challenges. Conrad had to put the free-shipping threshold at $100 for online orders. Heavy, bulky items cost too much to ship, so he's doing only curbside pickup on garden art or decorated rocks.

For Rose & Loon, a two-year-old gift shop in Rosedale Center with local and Midwestern artisan-made goods, e-commerce had been on the back burner until April.

With nearly 60 makers contributing to the store's selection, creative director Jerrod Scott Sumner created five gift boxes that are sold online. The themes range from cooking to relaxation and snacks. Just added were Mother's Day and graduation boxes.

Now there are plans to market the boxes, which range from $25 to $110 for most of them, to corporate customers as well.

A special "experience box," priced at $7,500, is supplied by 20 makers and includes a private tours of the Amana Woolen Mill, a Keg and Case walking tour in St. Paul and a candy-factory tour with free caramels for a year. It also adds in pottery and glass-blowing classes for four, a spa package for two and a $1,000 credit toward a custom cycle.

"When people can't come into the store, the boxes keep the registers ringing," Scott Sumner said. "We're sending them to people in Minnesota, Missouri, Kansas and Nebraska."

While the boxes won't fully replace lost income from craft shows and retail stores, the online presence also drives customers to the makers' individual websites.

Many retail analysts think the coronavirus will permanently tilt consumers' behavior toward e-commerce. George John, professor of marketing at the University of Minnesota's Carlson School of Management, thinks it is way too early to make that call.

"Most people's experience online since the coronavirus has been one of frustration," he said. "Maybe it's the grocery store making substitutes you don't want or Amazon's enormous dissatisfaction scores in the 60s and 70s within the last 90 days. People can't wait to get back to normal."

Dana Swindler, co-owner of Martin Patrick 3 in Minneapolis' North Loop, is not convinced of the long-term e-commerce value for his store, even though it added online promotions for the stay-home period.

Swindler said he has talked to a number of local brick-and-mortar apparel retailers that have offered online sales for years. "They tell me it's not profitable before or after the virus," he said. "It's hard to spend $200,000 in overhead for $10,000 a month in sales."

Martin Patrick's goal is to stay top of mind for customers through targeted online approaches. It has worked with vendors such as Eleventy to assemble several work-from-home outfits styled by the store's staff and placed on Shopify and Instagram.

The store also is launching online trunk shows, with a different brand every week. Customers have up to 10 days to buy online.

"We get close to 10 people a day buying through those methods," he said. "But we could never survive on what's coming in. Not even close."

Business is down 90% in April, he said.

Natalie Sudberry also moved to online commerce reluctantly for her Style Niche boutique in Rosemount.

"Many boutiques are online, but we've always pushed the in-store customer service instead," she said. "Our shoppers don't even browse much in-store because they rely so much on us for our help."

Sudberry has already seen proof of her patrons not seamlessly moving online at Style Niche. They like the Box Lock outside her shop that allows them to use a code to pick up or return their online orders, but they are buying only one or two items compared with four or five when the store was open.

"Most of our customers shopping with us online say they miss coming into the store," she said. "They're messaging us asking how something will fit or if they should buy a small or medium. Our customers still want the personal interaction."

John Ewoldt • 612-673-7633