When strategies such as JIT (Just in Time), Agile Supply Chain, Lean Management, and many more are too big to fail to go for a toss, then what needs to be done is a rediscovery of new strategies to stay afloat. The agony of the VUCA world created during COVID times has forced retailers to rediscover their business models.
India’s unorganized market, consisting of primarily mom-and-pop shops, stands at 90 percent, but they were not the only ones affected by the pandemic. Even the large players were suffering from overstocking and understocking problems constantly. Retail is changing and though retailers are focusing on four strong pillars to stay updated with new data-driven business practices and building a ‘dream store’ for their customers.
Time to go Phygital
While the internet continued to dominate the retail industry, consumers' attention was still drawn to the in-store experience, making both the online and offline journeys distinct and equally significant. This has created an urgent need for marketers to enter a hybrid system, known as Phygital, which combines physical experience with digital convenience. The physical model blurs the barriers between the online and offline worlds by providing clients with a seamless experience through a digital interface while eliminating the necessity for store visits, which is very important today.
To ensure successful phygital experience retailers have to streamline three I’s- immersion, immediacy, and interaction for a fast, engaging, and convenient experience.
In one of the recent articles, it’s mentioned that “As the second-fastest digitizing nation in the world, India is on the path to becoming a $1 trillion digital economy by 2025. Maximizing both online and offline to fuel each other has become one of the top priorities of retailers today.”
Even the investors and entrepreneurs have realized that the future of retail resides in this path from physical to digital, which is phygital as Indian unorganized retail represents an enormous opportunity.
New Technology Trends
Technology is the next pillar, which has the potential to become the holy grail of retailers. One of the major issues is the agony of long billing queues, which on average eats up huge customer’s time at prominent department stores, retailers should focus on reducing the same to prevent cart abandons. Until and unless the long queue issue is resolved the cart abandonment rate which stands at 70 percent presently according to a report will remain stagnant.
According to one study looking at changes in purchasing habits as a result of the epidemic, 87 percent of shoppers would prefer retail stores with contactless or self-checkout options. Convenience, safety, and technology will make the customer happy and return to buy more.
Shopify in one of their blog mentioned, “Although 61 percent of shoppers would rather shop with brands that also have a physical location over brands that are online-only, more than 70 percent of surveyed consumers said the checkout experience is their biggest pain point.”
Thus, retailers are focusing on creating a touch-free shopping system by incorporating tech solutions. Customers may begin to scan barcodes and QR codes not only for payments but also for obtaining information about the products, navigating the stores, ease of purchase, and earning loyalty points directly on their cell phones. This will reduce direct product handling while also addressing concerns about sustainability and accountability by giving production procedures better visibility.
The basic agenda that every retailer keeps in their minds across the globe is to enhance CX (Customer Experience), an important game-changer for the success of a business. This is easier said than done, especially after the introduction of multichannel and omnichannel retailing. In an era when retailers’ loyalty towards customers has become much more important than customer loyalty, a retailer can’t afford to make such mistakes. Thanks to the e-tail revolution which has made retailers ensure a holistic experience across all touchpoints irrespective of channel.
According to a report, India is expected to have 601 million active smartphone users, so it’s retailers’ responsibility to make their websites mobile-friendly and easy to use on smaller displays. It’s the time to encourage storytelling content for customers and prospects to elevate the CX.
The future is contactless, and the expectation is to create an experience worth the visit from browsing, showrooming, webrooming, purchasing, packaging to post-purchase servicing. The final dimension is the post-sale customer experience, which should consist of free and fast shipping, as next-day delivery would mostly increase the customer's likelihood of buying a product.
The fourth and final pillar is social responsibility and the environment. The philosophy behind implementing this is when customers couldn’t reach the stores, the stores have to make sure that they reached the customers and made their lives easier. Since many of the services in India are touch business, they had to hire doctors who prepared the SOPs which were needed to be followed by the employees before providing the service. This ensured customers high-quality service which was safe for them.
The pandemic also taught the retailers that collaboration over the competition was the need of the hour, where every retailer whether small or big needs to share their innovative ideas and solutions with all the retailers since their growth depends on industry growth. This gesture will also help them gain respect not only in their industry but the retail industry as a whole and the customers who received the service will pass on positive word of mouth which will help them gain new customers subsequently increasing their revenue.
To conclude, we can only say that the rediscovery of retail depends solely on finding new and innovative ways of enhancing CX through customer convenience and focusing on delight per square foot rather than profit per square foot.