From the drastic change in consumer behavior as they opt for daily necessities over luxury products, fierce competition as ecommerce emerging to be more sought-after, to thousands of brick and mortar retailers left with no choice but to shut down due to pandemic restrictions; it is safe to say that the physical retail industry has suffered some of the greatest losses in the pandemic.
Even if the world may seem like it’s getting back on its feet (thank you, vaccines,) the future of the retail stores still sits right at the edge of a knife. Let’s face it, there are still too many uncertainties to be dealt with to sit around complacently. If 2022 is nothing different than the past two years, then this should be the year that retailers redefine physical stores and what it has to offer.
More than ever before, 2022 is the year retailers must get to the bottom of coming up with a game plan to meet the new realities of shoppers, employees, needs and expectations, or you will simply find yourself heading to a cliff.
Challenges with Omnichannel Retail
Now, it is not new talk that physical stores have long been challenged by the rise of omnichannel platforms. The rise of the ecommerce industry was even more magnified during the onset of the pandemic.
It feels just like yesterday when consumers would select a retailer of their choice before they chose the brand. Now consumers would educate themselves online first about what they would want to buy, long before they decide where to buy it from.
Gone are the days when consumers would walk into a store like blank slates. Store employees are no longer the most knowledgeable and people to influence consumers in their purchase process. Considering these, the role of stores may seem like it has completely shrunk. Other retailers have panicked and responded to these changes by cutting labor hours, shortening training and sharpening employee skills, closing down branches and slashing inventory.
But you don’t have to go down this path. In this article, we will talk about four major aspects that will help you revisit these potentially harmful and rash decisions- and you’ll have the most of 2022 to start picking them up and implementing them. But, the clock is ticking. Here are the four.
Wage pressure in retail is a force to be reckoned with as we have seen over 4 million workers walk out the door in the US workforce alone. Currently, we don’t see this pressure taking the edge off any time soon- not just yet. Retailers have struggled to keep their heads above the water by passing on these wage pressures to consumers in higher prices. And most certainly, inflation will never miss the party- inflation’s impact will continue in 2022.
If there is one critical thing retailers need to do in 2022 is to make sure to squeeze out a bit more productivity from your employees. This means bringing back in-depth training programs, revisiting and brushing up those skills. By this, we mean actual “new hire” training programs rather than the “throw them to the lions and see whoever survives” schemes. Cross training is great because you have to be willing to create efficient workers who can play multiple roles. Come on, with the Omicron surge, we just don’t know who’s going to call in sick that day.
Automations to Boost Employee Productivity
Another point that shouldn’t be swept under the rug to boost employee productivity is to train them to make use of in-store technology automations. If we don’t save ourselves time and effort from repeated mistakes, manual inputs and data errors in 2022, when?
A trusted POS system is a great way to streamline basic business processes with accurate reportings and sales summaries. Choose one that is instinctive and user-friendly so that your employees can learn how to use the basic functionalities in just a short amount of time. A good POS should also have an employee management feature that will help you track their performance, monitor sales in their shifts and even secure transparency and accountability by limiting access to certain roles and data in your system.
In this fast and changing time, paying attention to how your employees work with automations will keep you ahead of the game by boosting their overall productivity by saving their time and workload, minimizing errors and manual data inputs.
The retailer that invests in employee productivity in 2022 will find themselves saving so much more by not having the need to hire and retain employees and losing productivity gains that usually come with bigger wages. Let’s make it our 2022 retail resolution to keep hitting two birds with one stone.
Digital to Physical Transition
If there is a trend that has been so in-our-faces during the pandemic is consumers taking a plunge into the online shopping craze. In fact, it’s a little more than that. We see that they’re building relationships and loyalty with online retailers. With this trend, consumers are willing to walk into the physical stores only, and only when they feel confident and comfortable with the business, and what they sell.
Now here’s the bigger challenge, when they walk into the store after getting to know about the brand online, retailers are still stuck around the idea that assumes the customer is a blank slate when it comes to the products. Therefore naturally, they have made no investment in equipping the store’s employees with the information on what consumers would want and need as they walk in after doing their own research online.
In this scenario, the consumers are armed with nearly all information about you, and you know nothing about them. That’s something to be scared about.
The One Who Knows More Gets The Upperhand
In 2022, retailers need to help consumers smoothly transition from digital to physical store and vice versa. For starters, store employees need to know the customers so that they don’t start the in-store part of the process completely oblivious as to what the shopper needs.
Consumers want retailers to know them and act based on that, but they also want control over that knowledge and how it’s used. Navigating those competing expectations is not easy. But retailers will have to make a move in this area or lose shoppers to online. This isn’t going to be easy, but you can’t win if you don’t try.
Once you succeed in being a step ahead by getting to know your customers, assisting them and influencing their buying journey will follow through like a breeze. With just the right information about them and their needs, you’d be glad to know that they’ll be walking out of your store feeling satisfied, valued and excited to tell their friends about your business.
Oh, make sure you have your customer loyalty program integrated into your POS system so you can keep track of recurring engagements and strengthen the relationship with your brand by occasionally giving perks.
One of the things the pandemic has definitely boosted is consumers’ omnichannel shopping behavior. Savvy retailers that can respond to the demands across multiple stores, warehouses, and even in-transit inventory are the ones who find themselves ahead of the curb. Stocks going in and out everywhere can end up ravaging through whatever inventory strategy you have in place.
How much stock do you send to a certain branch to replenish what was sold? How much is being safekept in your fulfillment centers? Or even how much stock has already been moved to meet online demand? If you do not have an inventory strategy adaptable and sturdy enough to cope with inventory moving across multiple locations and platforms, you might just find yourself suffering a slow and painful death. Think wasted resources and capital investment, out the window.
Let Automations Take Care of Your Stocks For You
There are many different ways to optimize your inventory strategy, and one of the best ways is by having an inventory management system integrated into your store’s POS. A good modern POS should have this, and the capability to manage it across multiple stores. Not only are you able to have a smooth and seamless ordering process with your suppliers but you can also keep track, monitor and update your inventory all in your system’s back office. A cloud-based one will let you manage your inventory across any device and any movement, in any registered location, will be reflected in the report in real-time.
Of course, a POS is a great step to achieving a more resilient strategy but that’s not all. You may also want to consider revamping stores, reallocating spaces and developing more efficient stock allocation and replenishment strategies. Remember, the more you turn a blind eye to even the slightest inventory discretions, the higher your level of profitability drain.
Customer acquisition is all about bringing in new customers - or convincing people to buy products from your brand. It is a process that leads customers down the marketing funnel from knowing the brand, making the purchase decision to actually purchasing the product and referring to their friends. So it can really play around heavy advertising and solid customer relationship management.
With the growing customer base in the digital platforms, online customer acquisition has grown to be so competitive that even established online brands have resorted to opening physical stores as another way to expand their customer base. Surprisingly, brick-and-mortar stores are now a cheaper way to bring in new customers than digital channels, and some retailers are finding that customers gained in physical stores have greater loyalty and a higher retention value.
You can acquire customers through a variety of marketing tactics, digital channels, and strategies (both on or offline). It often involves a mix of cross-channel marketing campaigns, which may include: social media, content and lead generation marketing; display advertising, affiliate marketing or even something as basic as email marketing. Whatever is your method of choice, make sure that it can evolve with the ever-changing consumer behavior and preferences.
In 2022, especially as these digital brands are opening up stores to purposely use them for customer acquisition, established brick and mortar businesses are going to grind to come up with new strategies and approaches to cope with this.
The Bottom Line
Whether you’re in the food service industry, retail or a luxury brand, these four points will apply to you and when implemented carefully, will immediately put you ahead of the game. Retailers need to pay attention to all four throughout 2022, regardless of how much investment or profit you have made in the previous year.
Again, with these many uncertainties and with all the disruption out there, nothing is set in stone for retailers. This year is the last chance retailers have to really make the necessary improvements to firmly lead stores into an omnichannel future. For some of these trends, there is no clear strategy or tactic - but if retailers don’t willingly hop on the learning curve now, they’ll never make progress.