How to Prepare for The Future of Retail

How to Prepare for the Future of Retail: many retailers say that brick-and-mortar stones are dead. The future of retail is digital only. However, we have three suggestions you need to follow to prepare your retail store for the future and its technologies.

Many blogs and newspaper articles have already proclaimed the end of the retail industry as we know it. ‘The Retail Apocalypse’ as they call it. They doubt the effectivity of brick-and-mortar stores and see the future of retail as online only. No physical location is tied to the products or services the brand offers its customers. Consequently, they have adapted their strategy and have moved from bricks to clicks.

We cannot deny the fact that retail is moving in a different direction than it was forty years ago. Back then, big stores and bigger malls were the epitome of retail. Right now, signals point in the direction of the online: we are entering the third phase in the digital evolution.

We are at the start of a new phase in digital evolution. The first stage was about making information available via the internet. The second phase was about mobile technology and new forms of communication. The third phase will be about automation and artificial intelligence. (Source: Customers the Day After Tomorrow: How to Attract Customers in a World of AIs, Bots, and Automation by Steven Van Belleghem)

The retail industry is about to change drastically. However, we still believe in the power of brick-and-mortar stores and don’t see them disappear soon. Physical locations are still very effective. Besides, customers have the opportunity to come into contact with the people behind the brand and the product itself. And, pop-up stores seem to be more omnipresent and popular than ever. So why abandon the brick-and-mortar store?

Instead of abandoning your brick-and-mortar stores, we suggest you focus on further improvement. No need to desert your physical location. However, you shouldn’t focus on this channel only. Want to prepare your store for the next technology phase? Focus on the following three key elements.

Consolidate your digital and physical channels

Online channels have increasingly become more important and are, of course, just convenient. A customer can visit your website, your social media, or your brick-and-mortar store. If a brand’s voice resonates on every of those channels, we call that a smooth omnichannel experience.

However, many brands and retailers still haven’t figured out how to blur the borders between the physical and the digital. They are stuck with a multichannel experience where experiences are similar but very much incoherent. Omnichannel, on the other hand, focuses its efforts on streamlining its message across all platforms. Whether that message is a brand’s website, social media, brick-and-mortar store or a pop-up store, coherence is key.

Shoppers these days are no longer using just one channel, and neither should you. In order to keep up, retailers must find ways to serve customers across all these channels and devices. This can be done by offering online to offline services such as click-and-collect, in-store pickups and returns and more. (Source: Retail Survival of the Fittest: 7 Ways to Future Proof Your Retail Store by Francesca Nicasio)

Firstly, how do you improve the experience between the digital and the physical world? For instance, you have set up a coffee shop that has a lot of customers when it’s rush-hour. You have difficulty keeping up with all the orders for lunch and want to find a solution. Our suggestion is you set up a system where sandwiches can be ordered online. First of all, you can make preparations before rush-hour begins. And, your customers can come and pick up their order without having to wait in line.

Another example on can be to let your customers order online. They can pick up their order in store without any extra costs. Many customers dislike it that they have to pay additional fees if they order online. We suggest you let them order your products online and to let them pick it up in your store. By doing so, your customer is satisfied since they could simply pick up their product in store. This way, you may be able to drive extra sales. After all, your customer is in your store and might pick up another product they like.

Our last example on how to diminish any friction is to offer customers support via chat or social media. If your customers have questions about a product that is not available or that is out of stock, they should not be forced to only have to ask their questions to an employee in your store. Your customer receives an answer much faster and is satisfied with the speed of your response. Bingo!

Utilize customer data for business decisions

Making business decisions, in some industries, still happens on the basis of gut feelings. However, something exists which can facilitate making these decisions and that thing is data. Interested in finding out what your customer’s favorite products are. Do you want to know what your store’s peak hours are? Curious to find out which promotions you should introduce to your customers? Data is the answer you’re looking for!

The main driver of the third digital wave is data […] The rapid growth in the use of data-collecting devices in both our personal and professional lives has made an important contribution in this respect. In 2017, each consumer has on average four connected devices. (Source: Customers the Day After Tomorrow: How to Attract Customers in a World of AIs, Bots, and Automation by Steven Van Belleghem)

Probably every one of your customers has a mobile device with them when they enter your store. Which data should I use and how do I use it, you might ask? For example, you want to figure out which products or which aisle is your customer’s favorite. When your store’s Wi-Fi is connected to their mobile device, sensors can log that device’s unique code, called a MAC address:

This code lets retailers track the movements of customers within their store, shedding light on tons of data points such as the amount of time spent in each aisle, where shoppers go after viewing a particular item, customer wait time at checkout, and more. And since each code is unique, sensors can tell if someone is a repeat customer. (Source: Retail Survival of the Fittest: 7 Ways to Future Proof Your Retail Store by Francesca Nicasio)

No more need for guesswork: simply use the data your store’s sensors pick up and translate those data in actions. The data you collect can for example tell you if you need to assign extra staff. In addition, this same data can inform you on how to arrange your products and if you can ameliorate their position in store. There are several data analytics vendors which can help you analyze your data to make appropriate business decisions.

However, not every sector and not every store needs the same system to collect data. If you’re a smaller retailer, there’s probably no need to use the exact same data analytics as your big competitor is using. So, we suggest you do some research before you pick a data analytics vendor.

Increase customer loyalty

There is a big difference between new customers and returning customers. You have probably read it a couple of times: returning customers spend more in your store than new customers. It is thus of utmost importance that you maintain those loyal customers at all costs. You also need to turn those new customers in returning customers as well. How do you do that?

One example is to implement loyalty programs. Gone are the days of physical cards landing in your customer’s mailbox. Moreover, your customers won’t need to fill out long forms anymore to be enlisted on your loyalty program. Easy tools can help you implement rewards that are no longer irrelevant to you customer and that are easier to obtain. An example of a company that does this right is Sephora:

Sephora has a great loyalty program called Beauty Insider that not only gives members points for every purchase, but also sends birthday gifts, invites to exclusive shopping events, and complimentary beauty classes. On top of that, members of the program can get tailored recommendations based on their profile. (Source: Retail Survival of the Fittest: 7 Ways to Future Proof Your Retail Store by Francesca Nicasio)

In addition to giving your customers rewards for the amounts of money they have spent in your store, another great idea might be to give them personalized little gifts or rewards. For example, you can give them a discount or send them a card when it’s their birthday. Another idea you can implement is that your customer not necessarily has to buy your products to benefit from your loyalty program. If they share your posts on social media or if they assist to in-store events, you can reward your customers as well.

Ready for the future of retail?

The future of retail is drawing near and if you want to stay ahead in the retail business, it is essential that you prepare for that future by taking matter into your own hands. However, when we talk about the future of retail we do not suggest you to make big investments in artificial intelligence if you’re a small retailer. This is only worth looking into when you have already checked off our three action steps. Crucial for future proofing your store is focusing your efforts on further improvements.

You should further improve the channels and methods you use and perfect them. Now it’s up to you! Learn from the action steps and the examples we provided and apply them to your business. Ready to develop your digital channels, ameliorate data use and increase customer loyalty? Good luck with your retail adventure!

Share with us how you are planning to implement these future-proof steps. Have any additional suggestions for your colleagues in retail? Don’t forget to share them!