Brick and mortar retailers were forced to transform almost overnight following the COVID-19 pandemic, however it’s the data-driven transformation of retail that many are focusing on as the world looks to life post-pandemic. Having a granular understanding of each store and what makes them unique allows retailers to localize offers and messaging that can drive store performance in powerful ways. Between new trends, hot products, and competitive pricing, today’s brick and mortar leaders need to understand their local customers in a deep way and take advantage of every opportunity.
Recent studies have shown that despite the pandemic, brick and mortar retail continues to be preferred over e-commerce by a significant margin. According to the US Department of Commerce Statistics, as a percentage of total retail sales, e-commerce sales rose from 11.3% in Q4 2019 to 14% in Q4 2020, reinforcing the power of brick and mortar. As consumers head back to stores looking for an experience rich in brand engagement, having insights into local preferences, behaviours and trends should be top of mind for three key reasons:
1. An informed strategy. Only when brand leaders understand what makes their local customers unique, can strategic planning be truly informed, and execution effective. With OR, store profiles are created which makes planning at the store level turnkey. Our platform allows you to you to act fast and go to market efficiently. With the power of OR, our clients see an average increase in topline revenue of 7-12% from the insights gained that inform in-store strategy.
2. Connecting with the community. Building a shopping experience that reflects the community a store is in drives sales by building an emotional connection with customers in a way that e-retailers can’t offer. An emotional connection leads to a personal experience, which drives brand loyalty. A recent Salesforce survey found that 70% of customers place the same emphasis on flawless engagement as they do on product quality, elevating the expectations of retailers in our new normal.
3. Operational efficiencies. In today’s world, retailers are focused on speed to market, but without proper planning it can comes at a price. With OR, staff make fewer mistakes, everyone from planning to execution works more efficiently, and only what’s needed is printed and sent to stores, creating less waste. Operations become more efficient and store performance goes up. In the first 12 months alone, OR’s client see a 20-30%reduction in non-selling hours, providing near immediate benefits.
Capturing in-store data and gaining insights into SKUs, customer behaviours, patterns, and the overall digital footprint customers leave in-store are giving retailers a competitive edge. At its core, a data-driven strategy leads to improved visual merchandising and the ability to anticipate trends, and retailers stand to benefit even further. For example, OR’s technology such as SKU Optimization , Resource Efficiencies and Workforce Management modules are focused on cost savings from efficiencies gained and increased associate productivity, allowing clients to track and measure strategic retail metrics such as traffic/conversion, and sales and revenue by fixture. Understanding associate LOE (Level of Effort) has become a priority for retailers, which OR supports with a focus on operational metrics such as cost to execute a campaign, value of assets in-store, campaign compliance/execution and communication with ticketing and tasks.
Prior to COVID, some brands still managed retail somewhat ad-hoc, with operations at the store level relatively consistent from store-to-store. The retailers that focused on localizing their marketing/merchandising and operations had a competitive advantage, but in a post-COVID world, understanding and leveraging local data and information– including municipal and state laws on social distancing and post-COVID consumer behavior insights – are critical as brands figure out how to offer an engaging shopping experience at a time when customers’ behaviours and needs are rapidly changing.
Having a localized brick and mortar retail strategy empowers retailers to tailor local operations while also ensuring brand consistency. With OR there’s no guessing, and by leveraging data, planograms are precise, execution is perfect and there’s complete clarity all the way through.