Technology, Employee Training And Customer Experiences On Trend For Retail

Transcription

1 50 A R N D E C E M B E R / J A N U A R Y

2 By David Ward Technology, Employee Training And Customer Experiences On Trend For Retail Brick-and-mortar retail has long been a very competitive business, and with the rise of online and mobile shopping, the challenges faced by stores on the street have only grown in recent years. Not only are whole categories, such as video and music/cd stores, now virtually non-existent, but as Bill Lewis, vice president of consumer products, retail and distribution for Capgemini Consulting, points out, There have been a number of major malls across the country that have closed their doors for good. Many airport retailers take their cues from the latest trends on the street, and developments in brick-and-mortar retail are often highly applicable to airport operations. Experts say street retailers that have image by istock/onnes D E C E M B E R / J A N U A R Y A R N 51

3 Left: Chris Hammond of Parker Avery says many chains are now pushing an omnichannel approach, a customercentric retail model that essentially fuses a retailer s online, mobile and brick-and-mortar channels into a seamless customer experience. Right: Kevin Mullaney of The Grayson Co. says despite the attention paid to ecommerce, brickand-mortar stores still will account for the vast majority of retail sales for at least the next decade. managed to thrive in this current market are the ones that are quickly adapting to how modern consumers prefer to shop. That means incorporating new features and technology while also putting an added emphasis on employee training and retention, all with the goal of providing an engaging customer experience that can t be matched by a few clicks on an ecommerce site. The ability to touch, try and test product has always been a focus area for brick-andmortar retail, but it is increasingly being labeled and marketed as a competitive advantage, instead of an expected part of the business, explains Chris Hammond, management consultant with The Parker Avery Group, an Atlanta-based retail consulting firm. Hammond adds that brick-and-mortar stores realize that many of their customers are using online tools as part of their shopping process even when they plan to make the actual purchase with their local retailer. As a result, these stores are adapting strategies to facilitate that behavior. The real key here and to the future is the integration of omnichannel capabilities, which is a customer-centric retail model that essentially fuses a retailer s multiple channels into one seamless customer experience with the retail brand, he explains. Omnichannel allows consumers to shop a brand in any way and at any time, and subsequently having the products delivered however and whenever they choose. Among the new amenities being offered at retail are the ability for consumers to order online and have the product sent to a store so it can be tried on before purchase. Stores also are encouraging ship-to-store options that let shoppers avoid large shipping costs for heavy or expensive items, while also letting them return items purchased at the chain s online site to their local outlet. Retailers with brick-and-mortar stores gain huge benefits with all these features, Hammond says. Tapping Technology Realizing consumers increasingly are using connected mobile devices not just for product research, but also for transactions, many retailers are adding new technology that allows shoppers pay for items in a variety of ways. You are seeing many retailers now letting customers using their smartphones to make purchases right there at checkout, Lewis says. Kevin Mullaney, CEO of New York City- 52 A R N D E C E M B E R / J A N U A R Y

4 based The Grayson Co., a consulting firm for retail, ecommerce, wholesale and omnichannel businesses, says some forwardthinking retailers are taking that one step further with technology that turns every store employee into a check-out station. Stores are now giving their employees ipads so they can not only answer any product questions but also handle transactions on the floor, he explains, suggesting this brings with it the immediate benefit of eliminating customers being dissuaded from a purchase by a long checkout line. Because tablets are now such a regular part of many people s everyday experience, Mullaney says this type of technology doesn t require extensive employee training. Georganne Bender, co-founder of the Chicago-based Kizer & Bender, a twoperson team of professional speakers, retail strategists, authors and consultants, says tablets are also helping many retailers better manage inventory while still being able to give customers the products they want. There are many stores that now have tablets set up on the floor and they let customers know right away that if they don t have it, they can order it online, she explains. One of the things we ve been seeing a lot more of at GlobalShop, the annual visual merchandising trade show, are what are known as limitless aisles, where a customer at a retail location can choose an item off a tablet and the store can either go to their nearby warehouse and pull it right then or they can deliver it to the customer s home the next day. Bender also notes the emergence of kiosks and tablets that can serve as virtual salespeople, capable of providing basic information about an item. Then, if you want more help, you can press a button and a real salesperson will come over, she says. Rich Kizer, Bender s partner, says much of this technology is aimed at making the store employee better at his or her job, a necessity given that many are now interacting with a far more educated consumer than they may have in the past. The danger for a retailer is a customer coming in and literally knowing more about a product than the employees in the store, Kizer says. That is a bad thing because it makes them more likely to buy from the channel they were educated in, in this case online. That can become a critical issue unless a retailer establishes a great training program. Any investment in new employee training is bound to drive up costs, but Hammond says it could pay off in the long term with a loyal customer base. Customers are willing to pay higher prices, to an extent, for convenience in location and an excellent experience, he says. Magic Mirrors, LOM-LOTs, Millenials Along with those macro retail trends, some of which are beginning to be seen in airports, there are a few other retail innovations starting to gain traction. Lewis cites the introduction of Magic Mirrors that let a person see how, say, a Rich Kizer and Georganne Bender of Kizer & Bender say the best way for traditional street retail to stay relevant is by investing in the hiring and training of sales staff to ensure a great customer experience. new shirt might look on him or her before making a purchase. You step on a pad and your image with the clothing is shown on a TV screen in the store, he says. These mirrors have the added advantage of letting shoppers cycle through a number of outfits without having to go through the trouble of dressing and undressing in a separate changing room. For airports, where changing rooms are atypical, such technology could drive higher apparel sales. Along with technology, Bender and Kizer note that many street retailers are getting smarter about the type of customers they target, realizing that although the younger demographic may get all of the attention from media and trend-spotters, older 54 A R N D E C E M B E R / J A N U A R Y

5 audiences, especially those age 50 and up, actually may make for a better target consumer, as they have more disposable income and often more time to shop. We refer to them as LOM-LOTs : lots of money, lots of time, Kizer explains. Targeting this audience requires more than just stocking products and sizes that might be most appealing; it also means tailoring signage and shelving for an older audience. You don t want to make older shoppers reach for items on a higher shelf because some may not be able to do that, Kizer says. So we tell retailers to make sure products for this group are within easy reach. Bender adds that signage also should be adapted for the eyesight of older consumers. We have a rule: Take the average age of their retail customers, divide it by half, and that should be the point size of the font the store uses for both for signs and the packaging of their products, she says. Lewis doesn t dispute the importance of older shoppers but adds that retailers already should be preparing for the large influx of millennials into their consumer market. There have been several studies noting that millennials will be 75 percent of the workforce by 2025, he says Hammond says that could end up being a real boon for airport concessions. Millennials specifically tend to be about convenience, technology, engagement, experience and feel good, he explains. Each of these can be leveraged by airport locations, many of them much more easily than large-scale, big-box, brick-and-mortar retailers. This shopper is looking for a personalized, optimized and effortless experience, and they are willing to pay more for it. From the welcome when they walk in, to having exactly what they need and getting it to them exactly when and where they need it, airport retailers have a great opportunity to hit a home run. Though it s currently only centered on food and beverage, one of the trends going forward could involve employee incentives and the move by a handful of high-profile restaurant chains to eliminate tipping. These restaurants are now going to have to train their people to give really, really good service without the motivator of a better tip on the backside, Kizer says. There are no indications this trend will be adapted by non-restaurant retailers, some of which have long relied on commissions as an employee motivation tool. But Kizer does emphasize the importance of hiring and training a staff to be motivated by more than a short-term cash incentive. In our view, in a very competitive retail environment both in restaurants and other stores, the key to success is going to come down to training, and to people, he says. The good news for retailers both on the street and in airports is that for all of the talk about the surge of online sales and ecommerce, brick-and-mortar retail likely will remain the go-to shopping preference for the vast majority of consumers for a long time. Noting estimates that 90 percent of consumer shopping is still done at traditional brick-and-mortar stores, Mullaney predicts those numbers will change, but only slightly, over the next 10 years. Brick and mortar is projected to continue to grow, and direct online business will also grow but at a slower rate, he explains. It is hard to say where the ratio will end up but maybe somewhere between 80 percent and 90 percent. D E C E M B E R / J A N U A R Y A R N 55