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What's Next After Customers' Big Shift to Digital? (Retail Talk)

Posted by Hanne Deceuninck on September 29, 2020 Hanne Deceuninck

As we prep for the busiest season in retail in an already exceptional year, our latest panel talks about what's to come for the industry. The pandemic left little choice to both customers and companies in their embrace of digital. Now that your customers have gone digital - what's next?

 

Joining us on this panel

  • Helen Baynes, Director of Customer Experience (ex CultBeauty and Net a Porter)
  • Andrew Regan, In-store Experience Specialist (BlueSeed Retail)
  • Lucy Larkin, Retail and Consumer Goods Partner (Baringa)
  • Rob Ward, Customer & Digital Partner (Baringa)

This new Retail Talk panel is co-hosted with our partners at Baringa.

 

Watch the replay or read the highlights below

 

Session highlights

1. Over the past few months, two types of retailers appeared as barriers to digital broke down

  • The optimizers: These retailers improved existing channels to meet new demand. Especially key for online players who now needed to scale up accross the organization. "It was almost like going into an unplanned peak overnight" (Helen Baynes, CultBeauty). CultBeauty increased its customer care team, extended return policies to make up for slower deliveries, adaped its merchandising strategy based on newly popular categories like body care and beauty tools.
  • The pivoters: These businesses had to change the way they do business, either by introducing new channels (Heinz' new DTC website, Pret a Manger introducing at-home delivery) or new services (Pret's monthly coffee subscription, Clarins' online beauty appointments, Hermes' personal shopping services via WeChat...).

Both types now face similar challenges: how do they keep successfully adapting in the coming months? How can online retailers make their new customers stay? How can stores make people come back?

 

2. Next challenge is all about making new habits stick 

  • "We should ask ourselves: what proportion of our new customers have now created new habits? Where have we actually removed barriers?" (Helen Baynes, CultBeauty)
  • Retailers need to anticipate what trends will stick to avoid excess stock or products selling out.
  • As a result, brands asking customers directly about their preferences and expectations quickly became a best practice during the lockdown. Most aren't considering going back from this.
Example: Monki surveyed its customer community throughout the lockdown. Their customers wanted positivity and fashion inspiration, and the brand strongly adapted their messaging accordingly with styling contests, self-care tips and more.

MORE: How Monki uses daily community feedback to adapt its messaging (video retail panel)

 

3. Improve the experience as higher customer expectations make a comeback

  • "The crisis led to an unusual partnership between retailers and customers. Retailers felt able to launch on a "best endeavours" basis and customers were mostly quite forgiving, happy to be served in any way possible." (Lucy Larkin, Baringa)
  • Now the pressure returns on retailers to add a level of sophistication to new launches: reducing delivery times, offering more choice, etc.
  • Best practice here, again, is asking your customers what they expect and prioritize accordingly
Example: French clothing brand Balzac first closed down their warehouse & delivery facility, then surveyed its customer base on whether post-lockdown, click and collect or in-store delivery was prefered, and gradually reopened from there with the full support of its customers and staff.

 

4. The power of creating conversations with customers 

  • "Any retailer should aim to directly access and engage their customers, to have that consumer intimacy." (Rob Ward, Baringa)
  • Customer intimacy - really understanding your customers, engaging with them, using customers as a compass to guide decision making... has been growing as a crucial theme in retail.
  • It helps retailers avoid mistakes like launching a product people aren't looking for or getting a communication campaign wrong. 
  • Customers seeing the actions you take as a result of customer feedback goes a long way in building brand affinity, especially now.
  • This means retailers need to create a system within their organization for continuous and direct customer feedback if they want to survive.
Example: Superdrug leverages daily community insights to update what's featured on their online store, answer customer questions on social media, in emails and newsletters...

MORE: Superdrug wins global award for its community strategy (article)

"There's huge power in asking customers what's important to them, and them being able to see you act on it. It's about being able to spot the trends and the spaces customers are moving into. And then earning that trust and brand love." (Helen Baynes, Cultbeauty)

 

5. Effectively connecting digital and brick-and-mortar

  • "70% of in-store tech doesn't land when you don't engage teams in-store", (Andrew Regan, BlueSeed Retail). This became more difficult as the speed at which new tech was delivered to the store increased.
  • If you want to get the online/in-store balance right, staff training & engagement is essential.
  • For each new innovation, answer the following questions: why is this being added to the store? How does it combine with other services? How can staff communicate it to customers? How can they use this to upsell other services or products?

Example: Asda and Tesco both did great here, focusing on staff training and creating dedicated teams for new services like click and collect, self-service checkout... This way, existing staff wasn't swamped with additional duties and queues were more efficiently managed.

 

6. Maintaining an innovative culture to keep adapting

  • Many brick and mortar retailers were incredibly responsive and broke many of their rules in the first few months of the pandemic (new tech launches went from 1-2 years to 2-3 weeks). 
  • That risk aversion is now creeping back in.
  • To stay lean, take a look at how new products or tech were launched during the pandemic: which processes did you bypass? Which rules did you break? Which approvals did you skip? Ask yourself if you can skip any of those in your day-to-day.

 

Want to get an invite to our next live Retail Talks? Subscribe here:

 

Topics: Retail Retail Talk

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