Retailers have to rethink their business model. Even before the epidemic, retail shops were facing tremendous competition from online sellers. These challenges have become magnified in this crisis.
Consumers are more likely to continue shopping online even when the lockdown is lifted/ eased in the future. Retailers can't afford a wait-and-watch attitude. They need to reimagine their baseline requirements and then turn to taking customer's attention to a new level.
A new baseline
To begin with, retailers have to follow the health and safety regulations and meet safety requirements. They should ensure everyone wears masks, maintain a safe distance, control the number of employees and customers inside the stores, institute contactless payment systems, quicker checkout, and more self-service options.
They can also offer a seamless e-commerce experience, from browsing, selecting, purchasing, and returns. Customers will start expecting the same level of digital experience as online shopping companies. They should ensure that they offer mobile responsive experience along with BOPIS - buy online pick up in-store. Waiting at the checkout counters would no longer be acceptable and an enhanced in-store experience along with a seamless digital experience will become the norm.
Re-thinking the experience norm
Holding events or offering special experiences and in-store services attracts customers and encourages them to stay longer, buy products, and spend more. Now, the retailers have to make in-store shopping even more attractive for those who visit in person. They have to give a reason for the customer to make the visit so compelling that it justifies the health risk and the inertia of behaviors they adopted during the lockdown.
Movie theatres (Cinepolis) provide an ideal example of how they came back from the assault of online (Netflix) and cable TV channels offering movies for home viewing. They made visiting theatres a better experience than watching it at home - offering reclining loungers, special food, and beverages delivered to the seat and lobby areas to meet friends before and after movies. Retailers can offer such exclusive superior experiences that will draw the customers out of their homes.
Enhanced in-person service is another way to compete and win over the online customers. Services can no longer be limited to sales support, greeting customers, handling complaints, managing returns, and handling special requests. They should plan special offerings like technical experts and certified installers, especially for more complex products.
Digitally native experience
This new approach and focus on innovation and service should be extended to the digital platform as well. Replicating the in-store experience on-line would be foolish, misguided and a certain disaster. Customers do not expect their virtual experience to be like the in-store one.
Investing in real-time inventory management, predictive analysis, AI-powered search, and personalization can create an enriching experience to shoppers, eg., social commerce, ie. selling through social channels, peer reviews, recommendations, multimedia experience. A retailer can use these capabilities to create an interactive, social experience wherever the customers are.
Retailers can take advantage of the greater flexibility and new contexts that digital offers by having different backgrounds/ locations to reinforce the message, displaying the same clothing on different models to show how it looks on different body shapes and sizes, using videos to demonstrate the actual working of a product/ service.
Another possibility is to take advanr=tage of the digital immediacy and interactivity used by online educational platforms. the exercises/ tests get graded immediately and AI-enabled corrections further enhance the feedback. The customers' user behavior can be analyzed, with his explicit permission of course, and recommendations can be offered.
This is not the time for retailers to sit back and wait for good times to return. They must adopt a more proactive and progressive approach to digital transformation and enhance the user experience and service.
The Pandemic Is Rewriting the Rules of Retail
by Denise Lee Yohn HBR July 06, 2020
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