2019 was a troublesome year for the retail industry. Mounting pressures surrounding the UK’s departure from the European Union have resulted in many retailers suffering from weaker sales than previous years.
Couple this with the closure of several prominent brands such as Mothercare and Forever 21, there’s no wonder that retailers are feeling the burden of consumer uncertainty and the growing need to adapt to changing environments.
Last year, there was a noted reluctance by businesses to make large-scale long-term technology investments. Recent reports have revealed that the UK falls behind when it comes to investing in new technologies. In 2019, businesses reduced or deferred any major project spend in IT and digital, mostly due to the uncertainty of Brexit.
According to a recent study conducted by Greenlight Commerce, 78% of UK-based eCommerce decision-makers don’t believe their organisation is fully prepared for Brexit. Additionally, the majority (91%) of the surveyed decision makers believe a no-deal Brexit will affect their business’ eCommerce offering, with the biggest concerns being regulation changes and a struggle to trade with EU customers.
While we don’t know what a deal or no-deal Brexit landscape will look like for the retail industry, Brexit will continue to impact the market until a decision is made and retailers understand the repercussions of that decision. The future is unknown, but retailers cannot leave things to chance.
So, what should retailers do to keep up with customer demands and ensure their business thrives in 2020? They must now work on having an optimised and fully functional eCommerce offering in place, ready for whatever outcome Brexit may bring.
A recent report found that by 2020, customer experience is expected to overtake both price and product as a differentiator for brands. In fact, 86% of consumers are willing to pay more for an excellent customer experience. Customer expectations and needs are at an all-time high, and consumers are now looking to retailers for new immersive experiences.
One of the key trends we will see in 2020 is “Experience Management”, a term coined by Qualtrics. Experience Management software allows retailers to monitor customer sentiments and feelings at each significant touchpoint . This important measurement can be used to drive retail spend, by homing in on areas where their offering needs to be improved and ensuring they make the customer feel good when interacting with that brand. Getting that right is the most basic of measures that will ensure customers are acquired, they spend, and they return.
Greenlight Commerce recently surveyed 100 UK eCommerce decision makers and discovered that nearly all (99%) are facing some sort of eCommerce challenge, with decision makers recognising the top two concerns were customer retention (41%) and customer experience (39%). Providing a bad customer experience can leave damaging effects and can sour relationships between customers and brands. Clearly retailers need to act now before it’s too late and customers never return to their site.
Consumer uncertainty is resulting in customers only looking to spend their money on brands they really like. As stated above, most consumers are willing to pay more for a product if the brand provides a great customer experience. Brands need to have a strong eCommerce platform that keeps up with customer needs and expectations and keeps them coming back to their website.
Increasingly brands are looking to keep up with the shift in customer shopping behaviours from store-based to online environments. This will continue in 2020 as retailers seek to close the gap between online and offline user experiences. Although retailers are hesitant to implement significant change, they are yet to realise that business as usual may cost them more. Mothercare did not adapt quickly enough to the world of eCommerce, costing them their whole business. Without a stable eCommerce offering, retailers will struggle to pursue opportunities in Europe and ultimately will suffer in the face of Brexit.
A stable eCommerce offering starts with the basics. Retailers who make small incremental changes to their current platform will see more benefits than those investing in emerging and often unproven tech. It is imperative for retailers to have a capable foundation before implementing high end technologies in an attempt to quickly catch up with competitors.
Although some brands will need to “go back to basics”, others will need to innovate and offer something new. The next year will also see advances in automation where repetitive tasks currently done by staff will be done by systems. As such, staff will be able to drive targeted action and get a better return on investment. The time spent dedicated to mundane tasks could be spent on personalising and merchandising, engaging the customer and ultimately driving sales.
2020 will be an interesting year. Government elections and Brexit outcomes will give many businesses a lot to think about. Now is the time for retailers to develop and evaluate their online channel, ensuring it is optimised for the best customer experience possible. Those who are willing to risk making a difference are the ones who will succeed in 2020.
Kevin Murray is Managing Director at Greenlight Commerce