Re-inventing Brick and Mortar Retail – Once Again
As we approach the end of summer, most retailers have realized that the impact of the pandemic will be long-lasting, especially when it comes to shopping in-store. The new normal requires new safety protocols and innovative experience-oriented value propositions to attract and reassure consumers.
Phased re-openings of many chain stores have brought forth new, cautious consumers that continue to put safety top of mind, but also still value convenience and the opportunity to shop in-person. With phased re-openings underway, it’s time to re-think and plan for the long haul. How can retailers prepare for the future of in-store retail right now?
Ensuring Safety for Shoppers and Store Associates
Safety is of paramount concern to both shoppers and retailers. Many retailers acted quickly and adopted new protocols to control traffic flow and emphasize social distancing, such as implementing new store layouts with one-way aisles and limiting capacity in store. Store employees are also continually sanitizing shopping carts and checkout counters. Hand sanitizing stations are positioned at store entrances and facemasks are mandatory for consumers and employees, which will likely continue for the near term.
Retailers shouldn’t stop there. It is now important to consider long-term, sustainable measures that build trust in the mind of the consumer, such as implementing a touchless shopping experience. Prioritizing new or improved touchless shopping experiences including self-checkout, mobile checkout, and increased self-service will help drive traffic and create a safer shopping environment, while ultimately requiring less capital investment.
In addition, solutions focused on safety tracking, such as using IoT and devices to rigorously monitor associates’ health, may require a greater upfront investment and may be more difficult to implement, but will prove valuable in the long run. Done properly, these efficient and accurate health and safety initiatives will re-build consumer confidence and trust in the brands.
Leveraging technology in this new capacity will also require an increased focus and investment in change management. This new paradigm that puts health and safety first from the top down requires that leaders and store managers ensure their employees feel safe, and store associates in turn make customers feel safe. In the end, this circle of safety creates a trust that permeates both internal and external relationships with brands and loyalty for years to come.
Embracing Convenience for Customers
There’s no question that managing through the pandemic has come with a sense of inconvenience, and stores looking to create a comfortable experience will require a shift in traditional approaches to customer engagement. For one, creating a quick in-and-out experience is paramount in a new normal.
Previously, it was common and expected that retailers were looking to extend their customer’s time shopping in-store. Today, and for the foreseeable future, it’s now all about making the shopping experience as fast and easy as possible for customers to find and purchase products. To do this, it will be important to leverage mobile devices and apps as part of the experience, which not only create a safer shopping experience, but also creates a more convenient one.
Other features that elevate convenience include in-store navigation apps that make it easy for shoppers to locate their items even before they set foot in the store, or redesigning the store layout to make the most purchased items the most accessible. Changes like these will require that front of store systems (including POS systems or checkout systems) and back-end systems (including supply chain, operations, and financial applications) are working together and as efficiently as possible.
Another critical aspect of convenience is being able to offer shoppers the same level of choice and service as they were being offered before the pandemic. Faced with erratic supply chains and volatile demand, which are constantly shifting across categories and channels, retailers need to double down on omnichannel fulfillment, strengthening capabilities for home delivery, and last-mile options.
This means increasing the ability to drop-ship orders and creating resiliency in-store and within warehouse operations. This will ensure that customers are able to cross off everything on their shopping list without having to go elsewhere to find supplies, and businesses avoid potentially losing customers who see this as an inconvenience.
Communicate Clearly and Often
It’s not only critical to create and implement strategies around safety and convenience — it’s equally important to communicate them to your customers.
Leverage every possible channel and touchpoint – in store announcements and signage, social media channels, mobile applications and advertising, direct email campaigns, chatbots, and contact centers – to let your customers know that you are taking safety and convenience seriously. Be sure to adopt a clear communications strategy that will reassure customers and include enough detail to let them know what measures you’re taking.
Prioritizing, investing in, and road mapping these communication initiatives are incredibly important, even when facing delicate cash flow situations. Retailers who were quick to recognize and implement some of these changes and make investments early on are already seeing increased conversion and revenues from the improved convenience options.
Generating capital to fund these initiatives is not an easy task, and retailers can adopt various strategies to make this happen, including;
- Reduce operational costs including SKU rationalization and rationalized labor force to fund growth initiatives;
- Implement creative commercial arrangements with vendors such as deferred payments and build-operate-transfer models; and
- Re-prioritize enterprise initiatives to deploy capital more effectively.
With no clear end in sight, the impact of COVID-19 on consumer shopping behavior is likely to remain for the foreseeable future. Retailers who may have pressed the pause button must quickly pivot and adapt to the new normal.
Brick-and-mortar retail must continue to reinvent itself, putting health and safety above all else. With the right strategies, flexible approaches, and a sharp focus on addressing changing consumer behavior, chain stores can and will continue to be the bedrock of the retail business.
Girish Dhaneshwar, head of consulting, retail, consumer goods, travel & hospitality at Cognizant.