Reimagining Retail through Digital

Consumer habits during the pandemic will have long-lasting effects on expectations and demands for retail going forward. Learn how to make the most of the moment and prepare for the new ‘normal.’
Reimagining Retail through Digital

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Even as quarantine restrictions ease and more retailers reopen their doors, customer behavior isn’t expected to go back to normal. In fact, the term “normal” has been almost entirely replaced by “the new normal” in any conversations about strategic planning.

For retailers, who outside of grocery and Amazon, have been among the hardest hit by COVID-19, responding to the surge in consumer adoption of all things digital is paramount for long-term success. Equally important will be the ability to create personalized customer experiences that seamlessly flow from online to offline and back again.

Consider a few key data points:

Global e-commerce sales are up 81% year over year as of May

Contactless payments have surged more than 40% in Q1

67.4% of consumers want brick-and-mortar retailers to provide delivery options

33.8% say they’d choose a merchant based on their digital options

Online grocery orders are on track to increase 40% year over year

71% of consumers shop in “micro-moments” (shopping while doing something else). More than one in three say they do so at least weekly and up to multiple times daily.

4.3 billion consumers will be using instant messaging apps by yearend

75% of consumer say many of their digital habits will outlast the pandemic

New Habits Die Hard

In many ways, the changes we’ve seen are just accelerations of the digital transformation that was already in progress. However, with millions of consumers still uncertain about their own economic prospects, the competition for spend is going to be even tougher. And research suggests that new habits adopted during the pandemic are likely to remain even for the so-called “Silver Tech” consumers in their 50s and 60s who 12 weeks ago didn’t necessarily use digital channels as their primary means of commerce.

Since the shutdowns began, 42 percent of consumers said they’re using digital channels to engage in activities more often than they did before the pandemic broke out, according to a series of PYMNTS consumer surveys of 12,000 Americans. What may be unexpected, the publication suggests, is the 75% who say that many of those digital habits will stick.

CEO of Tractor Supply Hal Lawton echoed that finding in a recent interview with the National Retail Federation. He said curbside pickup and ordering online, among other pandemic-era trends, are likely to become permanent fixtures of the economy.

As an essential business that has remained open throughout, Tractor Supply did not rely on its brick-and-mortar channel only. Instead they invested in expanding their online sales and curbside pickup. Their mobile app, like Walmart’s, also allows customers to submit the model and color of their car to help employees find them quickly in the parking lot.

Starbucks also is working on “convenience-led enhancements” like drive-thru, curbside and walk-up windows in suburban locales as well as redesigning stores with separate counters for mobile-order pickup.

Concierge services are also likely to be part of the unique shopping experiences of the future. While Best Buy initially implemented their concierge service to satisfy social-distancing requirements, CEO Corie Barry predicts it will live on in some form or another as a VIP service for customers in the store or online.

Similarly, Oregon-based winery Flâneur began offering virtual tastings by shipping bottles to customers and hosting private tastings and virtual happy hours via Zoom. Connecting with remote customers doesn’t need to end as the economy reopens. In fact, it could cultivate a crop of new, engaged customers.

Data, Mobile Drive Multichannel Experiences

Doubling down on digital technology is clearly important, but you also must integrate the customer experience (and support) across all those touchpoints to be successful.

Data will be the backbone for getting retail right in this environment—data to provide and even predict what they want. Make it easy for them to do business with you in their channel of choice, which oftentimes will mean in multiple channels for one transaction.

Use the smartphone to your advantage as a channel to connect to your consumers not only for commerce but also for communication. Tap into the device’s inherent benefits, incorporating location, multimedia, digital wallet and other device-native elements to drive optimal experiences. Deploying digital shortcuts or hot keys, such as QR codes, SMS/email links, a call-me option and other omnichannel reference codes can ensure customers are always moving forward in their shopping experience.

Rise of Messaging

If you’re not already using a messaging platform to connect with customers, you should reconsider. Although it’s not new for major brands such as Delta, T-Mobile and American Express, even more companies are embracing it, partly to reduce call volume and partly because it’s where their customers are. By the end of 2020, messaging apps will have 4.3 billion users globally.

Apple Business Chat, or iMessaging, enables Apple users to begin direct conversations with brands when and where it’s convenient, pausing and picking up where they left off. WhatsApp, WeChat and Facebook Messenger have similar offerings.

Your customer base will likely determine which messaging apps you adopt, but you’ll also want to keep in mind whether it’s a live person on the other end of the conversation or a bot. Even as you’re trying to make it easy for customers to self-serve or use lower-cost channels, creating barriers to reaching a live agent can backfire.

Video conferencing is another promising option for digital support in certain circumstances. Citibank HK recently announced virtual meetings for insurance consultation and onboarding across their insurance portfolio. The ability to connect with customers via video could be powerful for those who might previously have preferred a face-to-face interaction or for products and services that require more guidance.

For customers who are coming into the store, the smartphone has never been more important. Take Sam’s Club as an example. “As a member, you check into the store and your mobile device is a self-scanner. When you check out of the store, your device is the payment. There is no additional interaction required to validate the sale. Fast, simple and safe,” Krista Tedder, director of payments at Javelin Strategy & Research, recently told Digital Transactions.

Integrating the entire customer experience across channels—and making sure customers and support staff have all that data at their fingertips—is also essential to delivering the seamless and personalized experience customers are seeking. Provide your customers with best-in-class content, incorporating everything they need to buy with confidence across channels (ratings and reviews, product demonstration, social integration, live support, etc.).

Seamless and Secure

It’s especially important to avoid disjointed experiences between online purchasing and in-store pickup. Make it easy to pick up or return merchandise to a physical location, but also be sure to implement security measures to prevent fraud. Again, data comes into play. Customers and the staff supporting them need a comprehensive view of all relevant data, so they can jump in at any point in the customer journey and complete the sale or return.

What’s more, analyzing the data around your customer support interactions will further drive operational or process improvements that can help you reduce operating costs while also improving customer satisfaction scores and earning repeat customers.

The bottom line is that COVID-19 has accelerated the embrace of digital—not as a standalone channel but as an integral part of multichannel retail. Now it’s up to you to invest in and refine digital touchpoints and leverage data to make things easier, faster and more memorable for your customers wherever they are.

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