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Closing the Technology Divide in Retail Space
The ending year 2020 has exposed the depth of the divide in the retail space. The technology “haves” like Amazon and Home Depot prospered, pulling all their forces into scaling their logistics to accommodate growing digital demand and rearranging their brick and mortar locations for an omnichannel experience, wider rows and a more structured traffic flow.
Things haven’t been as rosy for technology “have nots” — smaller vendors, especially those doing the bulk of their business off-line. As the foot traffic came to a halt, making enough sales to sustain the business has become more and more of a challenge.
Below, we are taking a closer look at four other challenges smaller retailers face today that funnel into the main one—and how technology can mitigate them or at least shrink the gap.
Challenge 1: Being visible to customers at home
Your potential customers don’t go outside as much as they used to, which means that they are much less likely to pass by your store, drop in and make a purchase. Online presence and visibility, therefore, become crucial—your current and future clients need to be reminded of your presence and to know where to find you directly from their couches.
There are many ways to increase your remote visibility, from active social media presence to email marketing to direct mailings. Some of the more innovative ways to connect with your potential customers where they are is through automated SMS or local loyalty services like FiveStars or Belly (there are a few options out there.)
Online and mobile presence are also becoming non-negotiable: you do need a website or at least a landing page. And if your scale and products justify it, a custom app with push notifications and special offers will keep your clientele coming back for more — seriously consider one if you are in a grocery or consumer goods space. Which brings us to…
Challenge 2: Fostering customer loyalty
With piling up priorities such as homeschooling, working from home, and caring for close ones pulling your customers in every direction, their mental real estate is scarce. This is one of the reasons why one-stop-shops like Amazon are winning: they remove decision friction from the equation.
One of the best strategies for ensuring steady cash flow is to become the default source for one of your customers’ recurring needs — groceries, home improvement items, electronics. The best chance of beating national market leaders is in the local game through flexible payment options, leveraging word of mouth, and personalization.
Micro-financing options like Klarna and Afterpay allow the customers who may be experiencing financial tension to seamlessly buy now and pay later without leveraging credit. Offering those options to your customer base creates the level of trust and the sense of support you are offering them in the difficult times.
Referral programs allow customers to give and get discounts or perks by sharing their referral codes with their social circles. Those are especially attractive as tools of fostering connection when in-person contact is improbable and there are plenty of tech-enabled solutions out there for referral automation.
Finally, the recent development of technology has also made AI solutions much more affordable and easy to implement. In retail, AI tech helps not only with personalization of offers, but also with inventory forecasting.
Challenge 3: Inventory Management and Planning
It’s no surprise that consumer purchasing behaviour has changes dramatically in 2020. Because of these fluctuations, historical data which has always been the foundation of inventory planning, has become essentially useless.
In 2020 and onward, inventory management has to become much more nimble, adaptable, and strictly data-based. Which is why collecting transaction data becomes essential, either through a website or a customer relationship management system (CRM), or a custom technology solution, which may turn out to be much more cost-effective than it seems. A big benefit of a digitized inventory is the increased ease of converting sale and order data into valuable information for making informed decisions and adapting to fluctuating demand.
Challenge 4: Ensuring safety and convenience
It goes without saying that in 2020, both safety and convenience became paramount. But don’t rush to assume that physical retail is dead and you need to give up your lease. IMRG Capgemini online retail index, published in November, which tracks the online sales performance of over 200 retailers, highlighted the fact that multichannel retailers recorded growth of almost 63%, compared with 20% for online-only retailers.
Today’s customers expect an omnichannel experience with options such as curbside pickup, buy online pick up in store (BOPIS) and buy online ship to store (BOSS). At Target, for example, curbside pickup was up more than 700% and same-day services grew 273% overall in Q2 year over year.
For retailers, this means an even stricter inventory management as well as the ability to handle business at any time from anywhere. Cloud technology for retail is well-positioned to solve the access and flexibility challenges, giving your customers the experience and confidence they demand.
The best news is that while even this modest list may seem overwhelming for an average non-chain retailer, a comprehensive solution exists to help them leverage the latest technology to gain a competitive advantage with strong return on investment. Working with a managed service provider (MSP), you can build the technology stack to drive your business forward at a flat monthly feel, with an added layer of cyber security and business process optimization. We have done this for great businesses in New York, New Jersey and Florida. Get in touch with us at 3nom today to find out how.