Twenty-twenty has been a tough year for businesses. Between murder hornets, forrest fires, racial strife — and who could forget — a global pandemic, many businesses took a huge hit this year. In retail, foot traffic and sales plunged in March in April when lockdown measures were enforced.
The good news? Things seem to be picking back up. Foot traffic data from Statista indicates a V-like trend that shows traffic going back up after the drop in March. Meanwhile, the latest U.S. Retail Sales Reports show a modest 0.3% month-over-month increase in October 2020. Retail sales are also up 5.7% compared to this time last year.
Unless we experience a major second wave that cripples retailers once again, the industry is showing some signs of a comeback. In order to sustain it (and to prevent another business downturn), retailers must ensure that they have the right strategies and systems in place.
The businesses that will do well in 2021 will be the ones that recognize the lessons from 2020 and apply them in the year ahead.
To that end, we caught up with a handful of retail experts and merchants for a 2020 year in review. We asked them to share the biggest lessons businesses can learn from this year and what retailers can do to hit the ground running in 2021.
Check out what they have to say.
Putting safety first
The safety lessons that retailers learned will continue to be important in 2021 and beyond. While regulations may be more relaxed when the COVID-19 vaccine becomes available, retailers must continue to implement common sense measures to keep shoppers and employees safe.
“The most important takeaway from COVID-19 is to emphasize safety first. This is a common phrase we’ve all seen on bulletin boards in the employee break room for years, but it’s never been more relevant than it is today,” says Lucas Robinson, CMO of Crediful.
Robinson recommends using technology to both promote health and safety while improving the shopping experience.
“There have been some great advancements in technology and processes to accommodate the changes that retailers need to make, from contactless delivery and payments to delivery drones. Many consumers prefer a frictionless buying experience with fewer touchpoints and easier accessibility.”
There have also been advances in the technology you can use to audit your stores for health and safety. Because protocols can change, it is important to keep stores informed. Regularly check in to see that standards are executed.
Creating and implementing monthly, weekly, or by day-part safety checklists is a great way to ensure nothing is missed. By using a cloud-based app like Bindy, you can pre-schedule or request health and safety inspections. If something changes, assign a task to some or all employees to implement the new safety protocol.
Additionally, Bindy works on any device. So your employees can access and complete checklists from wherever they are in the store.
Best of all, when lapses are found, you can assign and review a corrective action from anywhere to ensure the issue is resolved before it becomes a liability.
Focus on retaining customers
Another significant takeaway from 2020? Don’t take your customers for granted. Research from McKinsey found that COVID-19 shattered brand loyalties. Thirty-six percent of consumers are trying new product brands and 25% are incorporating new products during the pandemic. Among those who tried different brands, 73% intend to keep switching brands. McKinsey also found that Gen Z and top earners are those who are most prone to this behavior.
For this reason, retailers must work extra hard to maintain and strengthen their customer relationships. Recognize that just because you got someone to buy from you once or twice, it doesn’t mean you’ll keep them as a customer over the long-term. To cultivate brand loyalty, strive to stay connected to your customers. Ensure that they don’t jump ship when a new brand comes along.
Carole Murphy, creative content designer at TopSewingMachines.UK, sums this up quite well.
“When customers come to your store, your purpose should be to encourage a lifelong relationship with them and to keep them coming back for more. Many brands lost their face-to-face interactions with customers when their physical locations had to close their doors. So the focus switched tracks to the digital sphere whether they liked it or not.”
Social Media is Key
According to Murphy, retailers should continue using digital channels even when stores open back up.
“Social media marketing is one of the best ways you can stay in touch with your customers even when your stores are open and business is normal. COVID-19 has forced us to do things like use current events to guide social marketing strategy, but this can be applied after the pandemic to stay relevant to your target audience,” she adds.
George Hadary, founder at Astteria, offers similar insights.
“A lesson that has always been important to the type of business we run as Astteria diamonds, that has perhaps only been proven more in 2020, is that customer retention matters. We think the model that we have long since adopted of a focus on retention over acquisition will be one that a lot of companies shift to in the coming year.”
Hadary adds that engaging and rewarding customers will go a long way towards building retention. “Ensuring this means reaching out to top tier customers, and creating strong relationships with brand ambassadors and advocates.”
The importance of digital transformation
“Digital transformation” has become a major buzzword (or phrase), especially this year. In 2020 it transcended the IT realm and became more mainstream in the business world.
But buzzwords become what they are because they’re significant. And in the case of digital transformation, it’s something that many retailers had to go through when the pandemic hit.
Digital solutions, particularly around ecommerce, had to be adapted quickly; stores were forced to close and more people turned to online shopping. Merchants that already had a solid digital retail system in place had a leg up over those that still had analog systems and traditional practices.
As Mike Bran, CEO at Thrill Appeal explains, one the most vital lessons that retailers should take away from 2020 is “the importance of an online presence.”
“The retail businesses which already had an online presence did not suffer much. They quickly started relying on their online sources. However, retailers without any social media or web presence struggled. When they decided to shift to online processes, it took them a lot of time to gain followers and grab the audience’s attention.”
How to apply this lesson going forward? Bran says retailers should take technology into higher consideration in the year ahead.
“Involve more technology in your business model to increase the number of sales,” he says.
“This includes offering the use of IoT devices to make quick orders; an example is the Amazon dash button. Many retailers are shifting towards offering subscription services. Just like Apple sells its gear where you have the option to pay in monthly installments or make trade-ins. Tech advancements are the future for retail services; the sooner you install them, the better.”
Digital security should be a bigger priority
Digital transformation is a beautiful thing, but it also comes with challenges. This is particularly when it comes to data security.
As technology and platforms evolve, so do fraudsters.
“We’ve seen a surge in chargeback filings over the last several months in response to the COVID-19 crisis. If there’s one lesson that retailers can take away from this year, it’s the importance of implementing a comprehensive and multilayered fraud management strategy.” – Monica Eaton-Cardone, COO, Chargebacks911
Eaton-Cardone continues, “To fully prepare for 2021, retailers must be aware of the dynamic nature of fraud and realize that a static, one-size-fits-all approach just won’t be effective. To combat tech-savvy fraudsters, retailers should be prepared to utilize tools such as Address Verification Service (AVS), Card Security Codes, 3-D Secure, and chargeback alerts.”
Diversify your offerings
This year showed us that consumers’ needs and circumstances can change very quickly. A good way to keep up is to be diverse with your product and service catalog as well as with the people you serve.
Chris Kaiser, founder and CEO at Click A Tree, shares that the main takeaway they picked up from 2020 is the importance of having a diverse product portfolio and customer base.
“It makes you a lot more crisis resilient,” he says.
That’s why one of his top tips for hitting the ground running in 2021 is to explore new customer segments. “Find new niches you can move into. It never hurts to try a few new things here and there — then stick with those that work.”
Invest in the supply chain
Consumer expectations and behaviors around order fulfillment have changed dramatically, with shoppers increasingly opting for fast and flexible fulfillment options like same- or next-day shipping as well as BOPIS and curbside pickup.
As such, retailers should ensure that they have the infrastructure in place to support these initiatives.
“One of the most important retail lessons learned in 2020 was the importance of investments in the supply chain to provide a better customer experience via flexible fulfillment options as well as expanding the omnichannel-focused supply chain,” says Carlos Castelán, Managing Director of The Navio Group.
“With the rise of more flexible fulfillment options during the pandemic – such as click and collect as well as curbside pickup – retailers can focus on expanding those programs to as many stores as possible or figuring out ways to improve those offerings for customers.”
The good news is that there are plenty of technology solutions that can aid retailers when implementing services like in-store pickup.
“Features such as geofencing allow the store to be notified when a customer is nearby or enroute to proactively come outside or even just working with a mall to have a centralized curbside pickup location for all stores simplify and improve the customer’s experience with these services.”
Castelán adds, “From an omnichannel supply chain perspective, continued investments that reduce the costs to fulfill orders or make more efficient use of inventory thus potentially reducing markdowns are helpful to the bottom line and, more importantly, customer experience. Helping customers more easily buy the product they want with the fulfillment method they find most resonant ultimately will help drive repeat purchases and customer retention.”
Speed and agility are a must
Being agile is more important than ever. While long-term thinking and strategy are essential, you must balance this out with the ability act and respond to trends quickly.
As Andrei Vasilescu , CEO and Digital Marketing expert of the coupon website DontPayFull explains, “The earlier you pick up the new trends, the sooner your retail business will start earning revenue. Analyze the present demands and trends of the consumers and quickly create relevant campaigns to boost the present demands.”
The relevance of your marketing campaigns with the current demands is essential to attract customers to your retail store. This is the must-follow strategy for the retailers now and in the coming years to keep their business running.”
John Moss, CEO, English Blinds, echoes this and says, “The biggest takeaway businesses that have thrived this year learned quickly was the need to be forward-thinking, adaptive, and ready to respond to the needs of customers.”
“Forward planning and getting ahead of the game by pre-empting trends and needs is of course the goal in uncertain times, but businesses also have to accept that they can’t mitigate every potential eventuality, and need to know when to move on from a failed approach or idea, draw a line under it, and continue with something else.”
Are you ready for 2021?
With just a number of weeks left in 2020, it’s high time that retailers look back at the year and take note of the lessons and changes to implement in 2021. Hopefully, this post gives you some insights and ideas that help you improve your business in the coming year.
About the author:
Francesca Nicasio is retail expert, B2B content strategist, and LinkedIn TopVoice. She writes about trends, tips, and best practices that enable retailers to increase sales and serve customers better. She’s also the author of Retail Survival of the Fittest, a free eBook to help retailers future-proof their stores.
One thought on “7 Essential Lessons for Retailers”
Really informative read! Agree with you, safety is expected to be key even in 2021. I feel sanitization and safety inspections of the stores as well as the employees are going to be valued by the customers. This can even reflect in the bottom line.