With the easing of COVID restrictions in most APAC countries, our lives are slowly returning to normal. But the old ‘normal’ is not the new ‘normal’ – especially in business.
The last couple of years has transformed retail. In Southeast Asia (SEA), 78% of consumers, 350 million people, are now digital consumers with the rate of digital consumption increasing faster than in other APAC regions. Retailers are seeing lost sales, with 49% of shoppers now hesitant to shop in-store.
With retailers facing the biggest challenge of their existence – how to make the most of their brick-and-mortar assets – here are four ways that can help them adapt to the new consumer shopping behaviors.
Upgrade your tech to 2022 trends
Most of us welcome technology, and the convenience it brings. Retailers who have adopted artificial intelligence are seeing improvements of 16% to 19% in customer engagement, business intelligence, profit margins, competitiveness, and innovation. But what are the biggest tech trends for high-end retail stores?
One is ‘cashier-less’ shopping, for example in Decathlon, which uses RFID scanning technology to automatically detect and charge shoppers as they drop products into their baskets. Another is chatbots, which shoppers can use to get quick, simple answers to service requests. However, technology can fall short if it doesn’t live up to the expectations of customers.
Customer expectations of brands are shifting and trends that combine the benefits of physical and digital shopping or ‘phygital’ are set to dominate over the coming year. For example, live commerce is a platform via which shoppers can video call an in-store expert who gives them a personalized overview of a product, a range, or even walks them through an entire store, giving them an ‘in store’ experience from the comfort of their home. These ‘phygital’ tools not only make life easier for the customer, but they also help improve a customer’s journey and let the brand collect crucial consumer insights, too.
Harness data to enhance your CX
We all know that e-commerce websites are specialists in collecting customer data to improve the shopping experience. Just look at Amazon, which tweaks its entire homepage to each visitor, depending on their past searches and purchases, to offer more accurate product recommendations. However, brick-and-mortar businesses can leverage data gleaned from their own technologies to improve the buyer’s journey, too.
Take video-powered retail, for instance.
First, the video software can use data to connect callers to the most suitable in-store advisor based on their inquiry. For instance, Marks & Spencer has a ‘Call the Expert’ video button, pairing customers with their furniture experts for a stronger chance of a sale. Once the call is complete, the software can collect invaluable after-sales feedback and ratings to improve future transactions.
With customer data, brick-and-mortar retailers can give shoppers exactly what they are looking for, boosting their sales potential and cutting costs, too.
Use new insights to become extra efficient
Data analysis helps retail leaders make stronger, more insightful decisions on how their business should spend its resources. One basic example is stock investment. Tracking product conversion rates to see what is selling well, and what is not, makes it easier to decide what to stock up on. However, data analytics does not stop there.
‘Dark stores’ offer customers more control over how and when they buy their products, plus a VIP, in-store shopping experience from their living rooms.
Instore and online data platforms can monitor the shifts or products that staff perform best on, and help managers optimize working schedules. It can even inform a store’s opening hours to match modern hybrid working routines. The analytics can identify if there is a rise in commuter footfall on particular evenings, and recommend which days they should stay open late. Or, if it detects a spike in relevant internet searches, visits to shop websites, or video call requests from home workers, it can suggest when stores should stay open exclusively for video retail.
This does not mean retailers need to keep their premium high-street locations open. Instead, they can convert them into cost-saving ‘dark stores’.
Open dark stores for optimized ‘phygital’ retail
A dark store is usually an existing shop, or out-of-town distribution center, that is partly or fully dedicated to fulfilling online orders. While they are filled with aisles of products and shop assistants, they are often closed to regular walk-in customers to create more space for stock storage, order processing, and one-to-one video calls.
These dark stores offer customers more control over how and when they buy their products, plus a VIP, in-store shopping experience from their living rooms. The proof is in the pudding, with retailers like the online grocery platform HappyFresh, which saw a 300% month-on-month growth in users since the launch of its dark store.
One is ‘cashier-less’ shopping, for example in Decathlon, which uses RFID scanning technology to automatically detect and charge shoppers as they drop products into their baskets.
This is just one example of a data-powered retail transformation that helps brick-and-mortar stores become an asset once again to multichannel retailers, by integrating the ‘phygital’ concept as consumers turn into hybrid shoppers.
While in-store shopping continues to have a place in APAC, recent years have taught retailers that true success comes from investing in digital and pivoting business models to whatever the world throws at us next.
After all, we are now living in the new ‘normal’ and this is the chance for retailers to engage with customers in a smarter, more personalized way.