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GUEST COMMENT Turning resilience into long term revenue

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Powering ahead: what retailers need to do next (Image: Adobe)
Powering ahead: what retailers need to do next (Image: Adobe)
Terry Hunter, Managing Director, Astound Commerce UK
Terry Hunter, Managing Director, Astound Commerce UK

People react in three ways in a crisis – some crumble and implode, some just grin and bear it, and some see the opportunities and grab them with both hands. We support the both hands brigade, because when it comes to UK retail which was already facing some icy headwinds before anyone had even heard of coronavirus, the choice was pretty stark – grow the business or go out of business.

 

And if you say, who are you kidding, here is the proof. We are working in ecommerce and this channel got a huge boost from a population that could not go to any shops except supermarkets. Some of our clients saw a double or triple figure lift in orders, and even while average order values were down as people started to take greater care over their pennies, these figures are pretty spectacular.

 

I think we can now say that some of that behaviour is going to settle in permanently, providing a huge boost to eCommerce, which represents a once in a lifetime opportunity to companies willing and able to take advantage of it. But make no mistake, if this advantage is handled badly, it will simply translate into increased orders but no profit.

 

Lower profits in the short term are an important part of the strategy. Let me explain; our clients have demonstrated their generosity during the crisis by going the extra mile to help customers in a whole host of ways – allowing staff to manage a customer right through the order and beyond, to make sure it was delivered but also that the customer felt safe throughout.

 

Longer term, this generosity is what builds loyalty because they can see that their chosen brands are reliable, trustworthy, friendly and helpful. And loyalty is about lifetime value and long-term profits.

 

Here are my five lockdown learnings that businesses need to implement long-term to remain relevant in the ‘new normal,’ or whatever we choose to describe what is certain to be a golden age for ecommerce.

 

Invest in customer services

Customer service is becoming a sales channel, so agents need to become brand ambassadors so they can cross sell and upsell. And by getting closer to customers through not just the call centre but social media and SMS, they become trusted advisors, while at the same time able to gather data that will enable to provide even better support.

 

Lead with data

Data is the differentiator – gathering the raw material to build insight into inventory, operations, marketing, channel mix, fulfilment, customers – you name it. You can then start to do clever things through a robust Customer Data Platform like linking your products and service to current trends and fashions.

 

The cadence of analytics needs to increase; this is not about monthly reports or weekly trading updates, but about analysing customer behaviour daily with granular metrics and then acting on them accordingly.

 

Emulate the in-store experience

Tear down the walls between on and offline because they now complement one another, particularly in the minds of the customer who moves seamlessly between them. Now is the chance for online to better emulate the instore experience using richer content, video, magic mirrors and apps connecting customers at home to staff in-store. And the store can get closer to online by enabling online browsing and ordering in-store.

 

Adapt your operations

Fulfilment as order volumes increase are going to get a lot harder, and less profitable, unless departments that once worked separately start to collaborate around a shared view of stock, orders and customers. And now is the time for operations and supply chain to get together to rethink stock location. Demand for warehousing has gone through the roof lately but use your CDP to decide where it should sit and how stores can be used differently as satellite depots.

 

Invest in third parties to ensure scalability

The future of ecommerce is not all about you, but about you and the people you work with in tech, returns, HR, payments, social media, brand ambassadors. You already work with a host of third parties but prepare to work with even more and take advantage of the fact that right now, they are eager to partner. Start small, on one project say, so you can see if you get on because cultural fit is a big part of whether it’s going to work out. If you don’t like each other, move on.

 

What’s next?

Lots to do and never enough time to do it in, right? My advice is to test and learn, fail and learn and do it at speed. The wind is now behind you even as stores reopen and ecommerce becomes the driving force for retail growth. Your people have got used to new ways of working and have proved to you that they are up for it. Let them run with it.

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