House of Fraser announced plans to shut half of its stores, Next reported a significant slump in profits, and Maplin closed its doors for the final time; 2018 has hit UK retailers hard and it’s not over yet. The industry is in the midst of what the media has declared the retail apocalypse with the closure of 5,855 physical store locations in 2017 alone.
While this year has not been easy for brick-and-mortar stores, global e-tailers like Amazon continue to grow apace, with first-quarter revenues exceeding estimates at $51.04 billion. Amazon’s strategy is clearly working, but this doesn’t mean retailers don’t stand a chance of competing against the online giants.
So, what can today’s retailers do to better ensure long-term success in a challenging retail environment?
Step One: Provide an Omnichannel Experience
There’s no denying that today’s consumers are increasingly choosing to shop online. As a result, they are interacting with retailers across multiple devices and channels – both physical and digital – and they expect a seamless experience across platforms in return.
Instead of ignoring the facts, retailers must embrace the digital world to stay ahead of the game. While “right person, right place, right time” is a mantra which is commonly used in the industry, very few retailers are successfully implementing it into their own strategies, leaving tactics fragmented and disjointed.
Retail brands will benefit from removing siloed approaches from their campaigns and focusing on deploying tactics that make online and offline work together to reach their target audience. Whether it’s offering click and collect or persuading in-store customers to use online discount codes, retailers must keep up with consumer trends and offer a unified experience at every stage of the consumer decision journey.
Step Two: Give The Power to the People
A recent study found that consumers read an average of seven reviews before trusting a business, and the success of Amazon can be linked to its commitment to publishing user-generated content and transparent reviews. The retailer’s mission is to be the most customer-centric company in the industry by using consumer feedback to shape its product offerings.
To compete with big brand names such as Amazon or Ebay, retailers will benefit from using data to deliver relevant messaging that encourages customers to share and discuss their products, whether that be across social media or by word of mouth.
Step Three: Embrace Technological Developments
Physical stores have a momentous benefit over their online rivals – they are destinations where people can see, feel, and experience products. However, retailers can no longer survive the apocalypse simply by opening their doors. They need to entice consumers back onto the high street using the right mix of data, technology, and digital strategy. For example, by sending deals to mobile phones using digital signage or deploying personalised offers based on location.
Waitrose has transferred the online shopping experience to its brick-and-mortar stores by allowing customers to scan and pay for products on their phones as they walk around the store using Quick Check technology. In response, it has been voted the UK’s favourite supermarket based on customer loyalty and satisfaction, beating rivals such as Tesco and M&S.
As the retail industry hits a crucial ‘thrive or die’ situation, retailers must rethink their strategies to survive in a challenging environment. By obtaining deeper insight into consumers and their journeys, embracing technology and the omnichannel experience, and working to entice consumers into stores, retail brands can maintain a sustainable competitive advantage.
By Kerry Ritchie, Senior Account Executive