How can retailers capitalise on both pent-up and longer term demand, asks Romulus Grigoras, Cofounder and CEO of OneStock.
Despite the welcome reopening of retail, no one should get too relaxed about a sudden return to normal on the UK’s High Streets, shopping centres and retail parks. While Sensormatic’s footfall index showed shopper traffic on the High Street on the first weekend of reopening rocketed 178% week-on-week, shopper traffic has not yet returned to pre-pandemic levels. In fact, they remain almost a third (-27%) down on the same time in 2019, showing there is still a long road ahead in bricks-and-mortar’s recovery.
Despite the fact that over 45 million vaccinations have now been given, people are still concerned about their safety in public and about the risk of contracting a new strain of the Covid virus, which will see them being cautious for some time to come.
In addition, based on the fact that people could only buy food in stores for so long and that many have got used to ordering things online that they would never have considered in the past, online sales grew by 46% in 2020 according to the Office for National Statistics.
A question of perception – these are only problems if you choose to see them that way
However, smart retailers will actually see the opportunity behind these twin challenges of uncertainty and online sales.
First of all, it is important to recognise the extent to which the barriers between online and on-site have blurred. We know the customer doesn’t care so the only hurdle to total channel integration is time, money and imagination.
This is way beyond the original conception behind the term omnichannel, which presupposed that each channel would continue to work in silos but start to share some data. Now, this is about all channels operating in the service of the customer and their orders. Once retailers have a single view of stock, orders and related customer details, they can re-engineer the function of each channel to deliver the best possible experience and efficient fulfilment.
New store formats are emerging – is your store your next warehouse?
One very important example of this, and one that solves the problem that some retailers are having with store profitability, is the concept of the store as a mini fulfilment hub so that a customer order can be fulfilled from wherever is most convenient and, of course, profitable.
This may over time transform the design, layout and role of the store as the existing stock room becomes a warehouse, whilst more space is allocated to click and collect, returns management and even second-hand items as interest among consumers in reuse and upcycling grows.
This hybrid on/off-line model however only works if the retailer can manage an order through any channel and any device. And by channel we mean not just store and warehouse, but supplier and third-party marketplace as well as future inventory. Once stock is given greater mobility then each channel can respond appropriate to its status and destination.
Staff can deliver a better and faster customer service
This approach also has the advantage of enabling retailers to deliver a better service on two counts. Firstly, the store acquires a new relevance because it can handle any type of customer journey but secondly, store staff are able to adopt more customer-facing roles as straight-forward order management is increasingly automated and accessed through the devices most familiar to them, their phones.
Ted Baker can see all stock across every channel
As an example of this forward-looking approach, Ted Baker wanted to develop a more cohesive and unified omnichannel solution, particularly to cope with a 35% growth in ecommerce sales. Through the implementation of the OneStock Order Management System (OMS), Ted Baker now has real-time visibility of inventory across its business. Orders are intelligently orchestrated to optimise availability, regardless of the location of items across its estate of store and distribution facilities. This means they can provide an enhanced delivery promise, confident in the accuracy and reliability of stock and delivery information.
Store profitability can be realised
Distributed order management liberates the store from its traditional limitations of location and stock pool size and enhances its role as an immersive experience centre. It also separates stock from location and enables the newer types of fulfilment that have emerged during 2020, including kerb side delivery, pick up from third party sites, pick to fulfil by aggregators and sub 30-minute order-to-fulfil.
As retail reopens, retailers able to manage any type of order through any channel will be ready to embrace the needs of shoppers whose expectations have in only one year become higher than ever.