The last two months in retail have been some of the most challenging we’ve seen in a generation. Many have pointed to the Spanish Flu and Great Depression as the only real benchmark for our current crisis. But amidst all the challenges, there are some interesting opportunities for retailers to capitalise upon, if they are quick enough to adapt to new consumer behaviours in the ‘New Normal’.
We have witnessed a number of key trends emerge in consumer behaviour, and an acceleration in consumer adoption of digital.
We need to recognise that the measures we’ve implemented over the last three months were just quick fixes. As we settle in for the long haul out of lockdown (and possible further waves of infection), we need to look at how we industrialise and operationalise these changes. After all, our current stores and infrastructure were not designed for this.
Start with data
As retailers start to create their re-open strategies, each will need to look at its business in light of their expectations of location, traffic and volume and put in place strategies that allow them to accommodate the appropriate shopping behaviour that they need. What proportion of your business is mission-driven with purposeful buyers, versus more experience-based buying journeys? Which stores will have the highest casual footfall? How much of your business can be kept online? Which customers do you need to invest in to reacquire?
Use customer propositions and technologies to maximise store efficiency
High volume businesses like grocery, and mainstream apparel will need to find new ways to support customers “popping in” for socks or a top-up shop, with customers who need to browse or make considered purchases. Many retailers were already investigating automation in stores with larger warehousing areas, but this could lead to some stores become micro-fulfilment centres for click and collect. Appointment bookings have been trialled by Apple and Best Buy and have the added benefit of a more personalised, premium experience, maybe combined with a “Try instore, Ship to Home” model, which will work better for high consideration or premium categories. Other omni-channel propositions which may have been on the roadmap will now need to be accelerated quickly to ensure that businesses have a successful peak and Christmas.
The instrumentation of stores will lead to zero- contact buying journeys
Ambient intelligent technology already powers some of the high tech experiences of Amazon and Kroger’s, but we will see greater investment it these systems. In some cases, stores are using IR as a blunt instrument to detect if people are running a temperature, but this will quickly shift to self-checkout, Scan&Go style propositions, even in categories that haven’t considered it before due to the risk of shrinkage – the revenue upside may now outweigh the risk. Gesture based interfaces and facial recognition for security (as introduced by the iPhone X) will become a lot more commonplace and may help address some of these concerns.
However, retailers adapt to the New Normal, the elements that have made retailers successful over the last 10 years will continue to make them successful over the coming months. Winners will have a strong sense of their brand purpose, and will understand how their brand can support and help consumers with the ever changing and very difficult situation we’re all experiencing. They will win through a deep understanding of their customers missions, and put their needs first – consumers will always reward this with their loyalty and spending. But most importantly, those businesses best equipped to adapt to the New Normal and to innovate in the face of challenge, will win market share very quickly. The Coronavirus outbreak didn’t fundamentally alter retail. It simply accelerated changes there were already coming.
Guy Elliott is senior industry lead of retail at digital consultancy Publicis Sapient
Main image: Adobe Stock
Author image courtesy of Guy Elliott/Publicis Sapient