03 September 2020

Reopening the store: what’s next for retail after Covid-19?
BY Ronan Gibney

For retailers, so much has changed in a short period of time from when shops closed their shutters in March to the gradual reopening over the summer. Retailers with physical stores, whether that’s one outlet or a chain of shops, have a lot to contend with. Fewer customers are visiting in person, and precious floor space has made way for signage and other safety measures. Then there’s the question of how to handle online shopping. It’s a lot to unpack. So what practical steps can retailers take to ensure they remain viable?

Let’s look at customer behaviour first. The encouraging sign is that demand didn’t wane even while shops were closed: consumers stayed home but continued shopping online. After Three closed our 61 stores across Ireland at the end of March, our online sales grew by 400 per cent at the peak of the pandemic. Independent research suggests our experience wasn’t unique. The IE Domain Registry’s recent ‘Tipping Point’ report found that 72 per cent of consumers either spent more or the same amount online as before Covid-19.

Data from Stripe found that many industry sectors became much more active online after joining its payment platform in recent months, compared to before Covid-19. Grocery and food stores were up 350 per cent, food and drink sellers were up 200 per cent, healthcare products were up 180 per cent and merchandise activity was up about 160 per cent.

Sales shift to online.

So it seems the sales were certainly displaced, but they haven’t disappeared. Now, shopping online has become part of people’s day-to-day routines. Clearly, some retailers were quick to spot this trend, sometimes setting up online stores within a matter of days. Services like Shopify have made this relatively easy to do.

Encouragingly, 46 per cent of SMEs that invested in online channels say they are as busy or busier than before, the IEDR found. At the same time, 53 per cent of consumers’ online spending during the pandemic went to Irish SMEs. But the same figures tell us that only 25 per cent of Irish SMEs sell online, so it’s clear many others are missing out on sales opportunities. To all intents and purposes, their stores might as well have stayed closed.

If we accept that e-commerce will be a big part of the shopping experience in future, what do retailers do next?

Making the customer experience easy.

The first thing is to make the online experience easy. Consumers don’t want a laborious process to buy an item. The design should focus on look and feel, especially for browsing on mobile devices, but also on cutting out unnecessary steps. That extends to giving customers as much information as possible, such as including extra product details that weren’t there before. Suppose someone wants to buy a desk for working from home; you need to give them all of the measurements and specs to help them reach a decision to buy.

Improving service with live chat.

Providing a live chat option on the website can add an extra layer to the static information. At Three, the impact of Covid-19 focused us on the things that were going to make the biggest difference. We used off-the-shelf software to set up a live chat option on our website so retail agents who weren’t in store could still answer questions from our customers. It proved to be a big win. It’s also a pathway to other kinds of interactions in the future. Our next step was to turn those chats into phone calls, and, ultimately, the goal is to see them becoming video calls or ‘co-browsing’ in the near future.

Another low-cost technology is to set up an appointment booking system for customers who want to visit the store. This option is available to businesses of all sizes and it helps to cater for customers who want to limit the time they spend visiting a store in person.

From a retail side, while some purchases are being influenced online, there are other items the customers would prefer to be physically present to complete the sale. This means retailers need to focus on the omnichannel experience: consumers might start a purchase online and finish in the store, or vice versa.

Imagining the ‘endless aisle’.

We call this the ‘endless aisle’. It gives retailers the ability to sell more than just what’s on the store shelves, and it gives the customers more options. A retail store only has a limited capacity to hold a certain number of products, so you need to have good inventory management to make sure the product is physically in store to fulfil an order, or that it can quickly move from the warehouse to whichever shop the customer chooses.

There’s no denying footfall in stores has reduced considerably since Covid-19. The IEDR found that 74 per cent of customers are more reluctant to visit shops due because of the new safety guidelines. One trend we have noticed in our own stores is that the number of people browsing has reduced, but the conversion rate of visitors to sales has gone up. People who go in store are there for a particular sale or service. When this happens, it’s really important for the sales staff to be ready to cross-sell or upsell related products.

In-store experience begins in line.

This high level of service can begin before customers even enter the store. In smaller outlets, there might only be space for two sales staff and two customers at a time. We found that by reassigning a sales agent to handle queue management, they could start troubleshooting issues for customers quickly, even as they waited in line. Sometimes, customers didn’t even need to enter the store; or, when they did, the transaction was much faster because our team had already begun helping them.

We found this worked best when we assigned fully trained staff to look after queue management, because those people had the full depth of knowledge to be able to handle all queries, no matter how complicated or simple.

Because we’re in a service industry, we need to take time to understand our customers and deliver the same level of service. The queue manager is the first touchpoint for someone coming to a store, and that can set the tone for the rest of the transaction.

There’s been a lot of talk that retail is dying, but I don’t believe that’s true. It’s changing and evolving. So as retailers, we need to create engagement in our stores and through our websites. We need to deliver a frictionless customer experience where the online and in-store channels work together.