This article is provided by Reshift Media, a Canadian-based digital marketing and development organization specializing in retail businesses.
If you own a retail business, you have more than likely seen first-hand the drastic changes in consumer shopping behaviour since the COVID-19 pandemic began, and have noticed the “new normal” has now set in and buying habits have been permanently transformed.
For instance, the growth in various aspects of eCommerce since the pandemic began has exploded. Online delivery accelerated by a decade in just eight weeks, retail eCommerce sales produced an all-time high in Canada, and recent research has found that online spending has reached more than $2 billion a month nationally, with Canadians spending an average of $178/month shopping online, which is a $69 increase compared to before the pandemic.
As retailers have learned to adapt their new procedures in various ways to not only accommodate the needs of their customers but to also remain profitable, the need to implement effective digital solutions remains constant. Whether it’s retailers incorporating online purchasing with curbside pickup, allowing customers to purchase items through a store app, or moving entirely away from a physical store to eCommerce, it is fair to say that the way consumers shop has vastly changed and digital plays a significant role in adapting to that.
Shopping habits will likely change at some point as the pandemic evolves, shopping restrictions adjust, and the wants and needs of customers alter depending on lifestyle changes. To remain flexible with future retail transformations, you need to be able to effectively scale your business to match the digital era we are in.
What does it mean to scale a business? In the retail world, scaling refers to a business that increases in sales or workload but in a way that remains conscious of cost and that does not lead to a decline in other areas. In other words, scaling means your business is prepared for increases, and you can accommodate these increases efficiently. There are several reasons why scaling your business is important, but within the context of changing consumer buying habits due to increased digital dependence, we have outlined some of the reasons below.
1. New customer expectations
First, it is important to recognize that as much as buying habits have changed, so have consumer expectations. In 2020 alone, over two billion people shopped online, which resulted in significant demand in eCommerce. As consumers continue to purchase items online due to familiarity and convenience, they will seek the same kind of experience when they shop at physical retail locations as well.
With shopping restrictions slowly relaxing, more consumers will move away from strictly shopping online as their main source of purchasing items. In fact, 70% of consumers do not have any concerns about returning to in-store shopping, and experts project offline shopping will take up 72% of retail by 2024. However, that doesn’t mean consumers will remove online shopping completely from their lives. Shopping online provides consumers with ease, flexibility, personalization, and convenience that in-store shopping doesn’t always provide.
If you are a retailer that focuses on in-store shopping over eCommerce, it is important to effectively prepare for an increase in customer demand by incorporating some of the same benefits that customers enjoy online; that way there will be more of a likelihood that customers will make repeat purchases in-store. For instance, a survey by PWC Canada found that 42% of Gen Z consumers prefer automated checkout options and other digital, self-guided experiences when they shop in person. The same goes for online shopping; bringing an in-store feel to a digital space will allow for a better overall experience.
2. A decline in brand loyalty
A noticeable trend throughout the pandemic is a decline in brand loyalty. If a retailer does not have a specific item in stock, customers have no issue with looking elsewhere, even if it means going against their favourite retailer. A study by Harvard Business Review that surveyed 71,000 consumers worldwide found that, on average, nearly a third will buy elsewhere if they can’t find the specific item they are looking for at their preferred store. The same study found that 72% of stock-outs were due to in-store ordering and replenishing issues.
One of the benefits of the digital era, especially in retail, is the ability for a wide selection. If a consumer doesn’t like one product from one retailer, there will be hundreds more selling the same thing. If you cannot scale your business and consider operational and fulfilment solutions to meet demand, consumers will look elsewhere.
3. An increase in adoption of omnichannel retail
If your business has not already been incorporating omnichannel retail, which provides customers with a seamless experience across all platforms (mobile device, in-store, desktop, etc.) you certainly should do so, as 73% of customers use multiple channels when they shop. Not only can it help boost sales and create a better customer shopping experience, but it can create more personalization and flexibility, which is important because this is the type of experience users got used to throughout the pandemic.
What does it mean to be a fully operational omnichannel retailer? The main difference between omnichannel compared to multichannel, for instance, is the seamless experience it provides. Yes, there are multiple platforms (or “channels”) that consumers can purchase on, but as multichannel retail is very disconnected, omnichannel is much more integrated across devices and touchpoints. Throughout the pandemic, extremely popular examples of omnichannel retail include curbside pickup, click-and-collect and other BOPIS strategies.
More retailers are adopting omnichannel retail, especially amid the heightened digital era that we are in. Companies with omnichannel customer engagement strategies retain 89% of their customers, on average, compared to companies with weak omnichannel customer engagement.
This mix of digital solutions and in-person shopping is one of the very reasons why retailers need to effectively scale their business. For instance, curbside pickup saw a 208% increase in usage last year, as more than half of consumers place convenience as the top reason why they were influenced to shop. Certain industries, like the grocery industry, have found that convenience is very important; 66% of grocery shoppers are willing to pay more to achieve convenience, and this high percentage remains consistent across various industries.
With omnichannel retail solutions likely here to stay post-pandemic, retailers should examine how they can effectively integrate digital solutions, if they haven’t already, into their customers’ shopping experience. Whether that means incorporating things like curbside pickup, expanding payment options, or implementing a better, more consistent design across channels, each step retailers can take will work toward effectively scaling your business. For example, 39% of consumers say it is unlikely or very unlikely that they will visit a retailer’s store if their website doesn’t offer insight into in-store inventory.
It is these types of details that can make all the difference. After all, a consistent level of outstanding user experiences is necessary to scale a retail business.
About Reshift Media
Reshift Media is a long-time partner of the Retail Council of Canada. The company is a Toronto-based digital marketing and development organization that provides leading- edge social media, search and website/mobile development services to retailers around the world. Please visit www.reshiftmedia.com to learn more.