Almost instantaneously, the retail landscape changed dramatically towards the end of March 2020. Retailers had to adapt and to do so, they made rapid decisions with short-term mindsets in order to adjust through the following few months when it was anticipated the pandemic would be over. But with the benefit of hindsight, many retailers may wish they had reacted differently, particularly around the adoption of new technologies. Such was the impact of Covid-19 that 37% of retailers reported having to make new digital transformation plans in 2020.
With a new national lockdown in place that looks set to last for at least the next few months, retailers that have fared well over the past year should now focus on adopting a long-term, strategic approach across multiple channels to meet new consumer shopping habits and to ensure future success.
The growth of online
Last Christmas saw an increase of shoppers completing purchases exclusively via online channels, rising from 24% to 34%. For some retailers, utilisation of growing online channels is an area requiring development. While the first lockdown in 2020 provided a great level of uncertainty for many retailers and resulted in the consolidation of finances for short-term survival, the hope of the end to the pandemic provided by the rollout of the vaccine programme should give retailers the confidence to invest in improving their online offerings for the long-term.
With an expanding consumer base moving to online channels, delivering a highly personalised service now provides a key differentiator in a crowded market. With many stores currently under enforced closure due to the national lockdown, investment in technologies such as AI assistants for chatbot interactions and VR for a more virtual hands-on approach will prove beneficial in building a reliable and scalable online strategy.
Moving into multi-channel
While a long-term focus on online channels will be vital in 2021, it should form part of an over-arching multi-channel strategy as the year progresses and stores begin to re-open post-pandemic. A fantastic example of this is Marks & Spencer who last year teamed up with Deliveroo to provide key grocery products from its BP forecourts following the initiation of the first lockdown, opening up a new revenue stream via an online channel. With 48% of consumers reporting a mix of online and in-store shopping for Christmas gifts in 2020, the pursuit of technological innovations across both channels will prove vital to address the changes in shopping habits in 2021.
The role of data in providing customer insights
The first lockdown encouraged many retailers to utilise their data in order to discover previously untapped but now crucial insights, such as how many people were entering their store at any one time, in order to maintain a safe environment for shoppers. This then fed into the introduction of technologies such as the traffic light system now seen in Aldi stores, with green indicating a safe number of customers in-store and red for when a one-in, one-out system needs to be introduced.
Application and use of customer data can however go further in 2021. In 2025, it is predicted that 175 zettabytes of new data will be created around the world, and with data being a retailer’s most valuable asset, these opportunities are only going to grow. Structured use of data can help retailers improve the overall experience they provide customers, using it to analyse the best impactful time to run certain offers or upsell specific products.
Investing in retail staff
In addition to technology applications, companies that are in a position to do so should focus their attention on the importance of employees to their organisation. In the past 12 months, retail workers have gone from working members of the community to being praised by Downing Street and called ‘key workers’ for their contribution to the fight against covid-19. Now is the time for retailers to give back to their employees, after all they are the biggest asset to any organisation. Investing in employees doesn’t just mean salary increases and bonuses. It’s about upskilling, motivating, and listening to the teams on the ground to create an agile, multi-skilled, and engaged workforce.
Enticing shoppers back to stores following enforced lockdown closures will be pivotal, and consumers need to be given a reason to venture in-store when they may now associate this as being the inconvenient option after months of online shopping. Retailers should focus on the experience opportunity in-store, training employees with the product knowledge they need to provide potential customers with informative and unbiased advice.
Utilising technology across a multi-channel strategy can also facilitate the growth of staff development by providing options for them to work in different areas of the business such as in the warehouse or on customer service helplines, such as online channels while stores are closed, allowing them to be multi-skilled as well as open up avenues for future career opportunities.
Strategic planning in 2021
Without doubt, technological applications that are harnessed in the right way can provide the basis for strategic retailer planning, this year and beyond. While retailers were forced to make snap decisions during the onset of the pandemic last year, many of the solutions implemented will in fact help provide the basis to accelerate their digital transformation journeys moving forward. This, along with the increased investment in developing employees in their roles, will benefit not only the customers that enter the store, but also enhance the role of the retail worker through new opportunities. Retailers that therefore balance multi-channel long-term strategies with a focus on developing their people are set up to thrive in the coming years.