Covid19 has changed the world as we have known it. No place will the impact of it be more felt than the retail sector. How will people conditioned into the new paradigm of “social distancing” respond to the usual hustle bustle of the mall or bazaar retail experience when the lockdown is gone is an open question.
Like other sectors, retailers amidst the lockdown should be busy with keeping their 30/60/90/120 day plans updated with “What-if scenarios” and “Plan Bs”. The focus areas for each phase will be:
• 0–30 days : Initial response, Setting up capabilities
• 30–60 days : Stabilization, Scale-up/down as needed
• 60–90 days: Evaluating alternatives for the new Post-Covid19 paradigm
• 90–120 days: Business resumption in “new normal”
These would need to be dynamic and adaptable plans with regular reviews and updates based on emerging realities.
As we hit the 60–90 days into the crisis mark organizations would need to start getting very granular and tactical as they look at the challenges ahead. For example:
· Cosmetics: Lots of premium brand sales are driven through the trial makeup counters. Even after the malls open, will people be ready for such trials? Will social distancing norms allow those kiosks to operate? What can be done instead?
· Fashion Retail/Garments: Would trial rooms be needed any longer? Will people warm up again to trying on clothes which others may have already tried or to the idea of getting into that small confined place just after someone else vacates it?
While the immediate challenge when retail opens up post lockdown would be to remove or reduce the risk of potential infection, the bigger opportunity would be to really examine the processes in retail that the sector has taken as default and see if there is a better and more efficient way of achieving that using the learnings from online retail.
Each category or segment of retail has its own challenges and specific buying behaviors and selling processes — such as trial fittings/samplings etc. — the challenge would be to find better ways to do it that are risk free and perhaps end up being more efficient and seamless — this is therefore the time for malls and retailers to sit down with their internal operations teams as well as with consultants to see what significant changes are needed across their business process.
Technology can be a key enabler of the new retail environment:
· Data Analytics/Machine Learning: this is the right time (albeit still a bit late) to really stop looking at Online and Instore as separate businesses or channels competing with each other — and look at them as a fully integrated means of reaching the same consumer and servicing the needs of the same consumer through multiple touch points. There is a huge amount of data on consumer behavior and preferences that are being captured real time as consumers engage in browsing and shopping online — this is the time to use all that data to see how the business can be reshaped.
· Virtual Reality: With VR, retailers can simulate an immersive environment customers wouldn’t otherwise experience. It can also be used to enhance the instore experience with outdoors real-life experience. Toms developed a 360-degree Virtual Giving Trip campaign to give customers the opportunity to experience first-hand the impact of their purchase on the lives of kids in Peru who get a gift of free shoes when the customer buy a pair for themselves. VR also gives customers the ability to more accurately visualize products which typically leads to confidence in their purchasing decision. Following its deployment of VR, Macy’s reported decreased returns of less than 2%. The use of VR technology in retail and marketing sectors is expected to generate $1.8 billion by 2022, according to ABI Research.
· Artificial Intelligence: With new social distancing norms, Virtual Trial Rooms can be a reality with AI. Virtual trial rooms equipped with digital mirrors/ virtual try-on mirrors can make it possible for shoppers to try different dresses without having to wear them. Shoppers can experiment with their outfit using a touch-based interface. Cosmetic companies can also benefit a lot because customers can see how a product would look on them without actually applying the product.
· Robotics: To reduce potential infection hazard for store employees some customer interaction tasks can be taken up by robots. On a visit to a store one may come across a friendly robot instead of a salesperson.
· 3D Printing: 3D printing is not only about reducing costs and time of production, but can also bring the customer experience to a totally new level of the ultimate customization and personalization. Post-Covid19 there will be a demand for new experiences. Retailer should be ready to deliver experiences that are optimistic, entertaining, and fresh. The ability to see their product being created in real-time on a 3D Printer at a retail store can be a unique draw to get people back into stores.
5G: With 5G, retail companies can help power new, innovative technologies with more speed and reliability, gather more data, and ultimately help build a long-lasting relationship with customers. With Internet of Things (IoT) and mobile apps, innovative trends are reshaping what many people expect now when entering a store. The addition of 5G technology to an existing network architecture can help power new technologies many retailers are beginning to utilize, such as: personalized digital signage, augmented reality, virtual reality, video and pattern recognition of shoppers and interactive mobile apps
The takeaway here? Times are tough. But no need for panic. Human needs and wants will still exist on the other side of the pandemic. Perhaps with an even greater desire to physically reconnect with their favorite brands and retailers. Technology can play a key role in ensuring that you are the destination they desire the most.