Recovery is the main concern for retail leaders right now, whether they are well known brands or small chains. As lockdown restrictions begin to lift for most parts of the UK - with the lingering potential that any city or town could go back into lockdown at any time, it is yet unknown what the full-scale economic impact of lockdown and post lockdown buying habits will have on retailers.
A key way to build momentum and help boost recovery, is to track customer buying habits both on and offline, but in even greater detail than before. With only weeks of offline data to look at since shops reopened - but thousands of data touchpoints to look at online, retailers need to up analysis and reporting to understand their customers better.
To say that the retail sector has faced tough times in 2020 would be a massive understatement. High streets, shopping centres and retail parks became ghost towns at the height of lockdown. Consumer habits and spending shifted, peaked and troughed with trends and micro-trends spiking and then being replaced with new sub fads - as the British public came to terms with the pandemic and adapted to a new way of living.
With all this going on it’s made it extremely difficult for retail leaders to keep up – yet their data for online and offline buyer habits is a treasure chest of insights that can help to boost recovery, if they are closely analysed.
With the closing of bricks and mortar shops for a significant period of time earlier this year, consumers and retail businesses switched their focus to online stores. For most businesses that run both online and offline shops, they’d have had to take a serious financial hit on having to close their physical stores. And for any business, finding creative ways to offset even some of that loss was and continues to be a real challenge.
Yet data can help retail leaders translate buying habits into action and help them focus on products, services and offers that are going to convert into sales and income. No matter how short lived those trends might be. Doing this can help streamline stock management, maximise marketing spend and ensure policies are in place to help the business capitalise on where customers transactions are going.
One of the first things retail businesses need to do to be able to translate data into action is to up reporting. When a business takes a financial hit, increasing and analysing data touch points is vital to understanding the shape of recovery and how you can help to fuel it. No one has lived through a pandemic like this in the modern era, let alone done business in one, so looking at data from a monthly or even weekly view may not give you the insights you need.
Take returns as an example. Reports believe that the coronavirus will ‘exacerbate’ UK retail’s returns problem as more people move online for their shopping needs. Openpay conducted research into returns in the UK and found that £5.2bn worth of goods purchased online is being returned every year.
The research also found that one in 10 shoppers make purchases with returns in mind, intentionally buying items that they don’t intend to keep. It means for retail businesses they need to look at the data to understand what volume of sales turn into returns, what items are being returned and if there are any patterns in which customers are returning items. If you have a high volume of sales, analysing these daily could be key to reducing cost in this area of the business.
And many retailers find returns to be time-consuming, error-prone and labour-intensive. It can mean manually updating inventories, re-adjusting WMS records and re-calibrating stock projections. Retail businesses should be using their data to understand their returns in order to make changes to their policy and software - to speed up their returns process and reduce cost.
The last few months have advanced many customers’ expectations by two or three years. They have embraced online and instead of in store customer service, they expect personalised online advertisements, promotions that meet their needs and recommendations that suit their taste.
All of this can be achieved if retailers make their data actionable and use analytics that enable them to better understand their customer’s habits. Knowing your customer and their habits goes a long way to being able to maximise revenue, offset losses caused by the coronavirus and put the foot down on that road to recovery.
Jon Roberts is head of sales at OrderWise