Retailers Are Heading into a Post-Covid Era: 5 Strategies for Managing Stores and Driving Sales in the New Retail Landscape
The COVID-19 pandemic changed the retail landscape dramatically, as more consumers switched to e-commerce, and retailers shifted to accommodate shopper’s demands for goods. As lockdowns end, and North America is “opening for business,” experts are optimistic for the future of retail. The annual retail forecast of the National Retail Federation predicts retail sales will grow between 6.5 percent and 8.2 percent to more than $4.33 trillion in 2021.
Now retailers must look forward to the future and manage their stores to increase sales effectively. Here are four strategies to drive sales post-COVID and beyond.
- Adapt to Customers New Shopping Behaviours and Improve Online Presence
A December 2020 McKinsey survey found that 75% of consumers say they have tried a new shopping behaviour such as online shopping or curbside pickup. Nearly all respondents say they intend to continue the behaviours after the pandemic ends.
While customers used online shopping for essentials like food, medicine, and health needs, McKinsey reported significant growth for online shopping for other retail categories. Overall, there was a 15% to 30% increase in online shopping across the board:
- Apparel (+19%)
- Children’s items (+25%)
- Home decor and appliances (+30%)
- Fitness and wellness (+28%)
With all of this consumer attention for various goods shifting online, retailers must continue to improve their digital presence. Even if a retailer doesn’t have a state-of-the-art website, it’s still possible to capitalize on online shopping. One powerful way to create a good digital strategy that drives both sales in-store and online is using Google Shopping, which shows relevant products in customer searches. You can then drive attention across multiple channels, encouraging customers to purchase online or in-store. Going after web shoppers won’t cannibalize your in-store shoppers either, as studies show 65% of a shopper’s budget is spent on in-store purchases.
- Offer More Convenient Ways to Receive Purchases
Once customers find your merchandise online, how are they going to receive it? Here’s where omnichannel fulfillment methods such as BOPIS and ROPIS come in. Many midsized retailers have begun to offer BOPIS (Buy Online, Pick Up in Store) as a way to boost their bottom line. BOPIS grew by 500% during the pandemic and shows no signs of stopping. The growing trend is likely here to stay and is a vital part of a retailer’s online strategy, but retailers should also consider another omnichannel offering: ROPIS (Reserve Online Pick Up in Store).
With ROPIS, customers have the option to retrieve their item and speak to an associate about product features, colors, sizes, etc. without having to actually pay. When time for pickup, spending time with an associate (while adhering to health regulations) can actually increase the amount of a customer’s purchase as they may be enticed to add items to their bag or basket. Outdoors retailer Orvis began offering ROPIS in 2019 and reported it was a success saying, “We are seeing a double-digit lift in order size. It also helps with breaking down silos — digital budgets’ paid search ads are now tied to a transaction.” When COVID-19 began, the brand pivoted to offer ROPIS alongside curbside pickup.
- Find New Ways to Showcase Your Product
When stores were forced to shut down, retailers needed to get creative. The same need exists today, as we transition to a post-COVID-19 world. Consumers can get nearly anything they need from online giants like Amazon and Walmart, which means that retailers need to find new ways to show off what they offer. This opens the door for collaborations and partnerships across brands. For instance, Hy-Vee partnered with DSW to offer “shop-in shops,” letting customers browse a selection of DSW shoes while in the grocery store. They could then scan the display with their phone and make an order for the shoes to be shipped to their home or to a locker in Hy-Vee.
While midsized retailers might not have the budget of Hy-Vee, they can still find new ways to showcase their product, be it with a mini pop-up store or a curated gift package with merchandise from a brand that complements, not competes, with the retailer’s offerings. They may follow the example of North American bookstores that offer customized “mystery” boxes of merchandise selected according to customers’ likes and dislikes.
Returning to Google Shopping, it can be a good way to determine what you should stock in-store and online. You can track Google consumer shopping searches and trends to see what inventory you may want to order and what could be a slow mover that needs to be discounted to free up space.
- Develop Precise Order Fulfillment
Once you know what consumers want, it’s time to determine how best to complete their orders. All of the pieces need to be in place. Fulfilling orders means considering the following:
- Physical Space (where to store merchandise, where to offer pick-up and/or curbside, how to advertise it)
- Inventory Management (managing “out of stock” moments, reduce inventory for slower products)
- Order Fulfillment (where orders can be fulfilled across the warehouse, other stores, or supplier)
For instance, you may want to convert a store with low foot traffic to a fulfillment center so orders can be processed with a faster turnaround time. Your customers will still be able to pick up their order via a touchless shopping process, but you won’t have to worry about fulfillment at the individual stores’ levels.
Your POS system needs to include information such as:
- What products are in stock
- What the payment and pickup process is
- Where the item(s) are stored
- Where they need to be delivered
Your POS/inventory management should be regularly updated with stock levels and also display where products are, so your staff can quickly retrieve them, order from the warehouse, or prepare for pickup, be it ROPIS or BOPIS.
- Empower Retail Staff
As you refine your ordering process, you should keep your staff informed, equipped, and ready to adjust to the changes. Reduce frustration for both your workers and customers by giving your staff the tools to succeed and offer excellent customer service. Your POS/Inventory management should be regularly updated with real-time inventory stock levels at all of your locations so staff can quickly retrieve merchandise or order it from the warehouse. Enhanced tools for replenishment, cycle counting, and processing orders will help make any changes easier for employees and customers.
Outside of order fulfillment and sales, you must also focus on health and safety. While you want to consider how to make your customers feel comfortable coming into your physical store to pick up a purchase, you should also think of your staff’s safety. Make sure you have hand sanitizer at each register and limit the number of people allowed in the store at one time. Opting to offer curbside pickup will help reduce the number of people in your store and also minimize contact for your staff. Just make sure that your staff is well-informed with how to find the order, notify the customer, and deliver it to them outside.
Looking to the Future
COVID-19 made a significant impact on retailers as the pandemic disrupted businesses and stores were forced to make changes in operation, order fulfilment, and other aspects of the industry. It has been over a year since COVID-19 impacted the retail landscape and Retailers must continue to be adaptable in this changed and altered world.
Knowing you have the right tools to stay profitable and successful will give you and your staff peace of mind, plus help you meet consumer demand.
Magstar Total Retail is more than an ERP system, we’re lifelong partners in the success of your retail store, both in times of crisis and calm.
If you’d like to discuss how you can reinvent your retail chain to match the “new normal,” Magstar President Steven Greenwood is happy to connect with you.
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