If you are a  traditional retail store owner in 2019, chances are you are consumed with this thought of the future of your business far more than you would like. First there is this never ending hysteria around things like ecommerce and extremely vague terms like “digital”,  and that how the future is all about these things. But then you also hear news of massive ecommerce companies like Amazon and Alibaba, trying to open retail stores across the world complimenting their online stores. With this lack of clarity and definition, it can become extremely confusing for a retail store to plan and secure the future. Well the good news is we have compiled the top 7 factors to consider to plan for the future.  So read on.Let me address the elephant in the room- Physical Retail stores are alive and there are no indications of the so called death of the retail stores. That is however if your store has the character to survive. This caveat is critical and this is what is often most ignored-  Stores should have the character to survive in this new age and this character depends on the willingness to foresee and adjust to the changing consumer shopping habits, changing retail eco system, future trends etc.

Now that we have established that adaptation is the key, this is where it gets trickier and where most businesses mess up. What do you adopt and what do you discard? Every person you meet assumes the role of an expert and keeps suggesting something extremely vague or something that you probably never heard about. Well to make it easy for you, we have compiled a list of things apparel retail store owners must keep in mind to be ahead of the times and “Future Proof” your business.

Here are the top 7:

1) Recognising that retail is`nt what it used to be:

As the saying goes- Change is the only thing Constant. One character trait that every retail store must have is to be open to change. For the last many decades, apparel retail stores have banked on 3 main factors for their sales-

• Choosing a store location that sees heavy pedestrian traffic.
• Great looking interiors and appealing Display Mannequins to lure the passer bys in
• Luck

Although the manner in which retail stores approach still remains similar, consumer shopping habits have dramatically changed in the last few years. One of the biggest changes in consumer habits is the use of Mobile. According to a study by Nielsen and Google`s Mobile path to purchase study, people spend more than 15 hours a week in researching or browsing things to buy on their mobiles. The report also found that 93% of those have resulted in a purchase and 82% of those purchases happened in offline physical retail stores.

What this means is that clearly, mobile is playing a very important role in people`s path to purchase. While retail purchase likelihood is strong, window shopping is increasingly happening over the screens of the mobile phone. Whether it is sitting in a bus stop or on a boring day at work, the mobile screen is increasingly grabbing attention and influencing consumer behaviour and buying habits.

It is not Physical or Digital. It is Physical with Digital

-A.T. Kearney’s Omnichannel Shopping Preferences Study

2) Understanding what the Future Holds

Now that we understand that retail is not what it used to be, we must now look at where is retail heading towards?

There used to be a time when the retail stores controlled how the system of shopping worked. Consumers had to go to the store when they wanted something. But with changing times, not only have the number of retailers per capita increased but it is becoming more and more apparent that it is now the consumers who are in control of what sells and how it sells. Hence the contest now is who can get to the customer the fastest and in a way that is most comfortable for the consumer. Convenience is the key!

Like discussed before, consumers are increasingly using technology to make their shopping experience more efficient. Also the general habits of an average consumer are changing. Letters have been replaced by messaging apps, waiting for a cab has been replaced by ordering a cab, meeting friends has been replaced by group chats. In such a smart phone dominant era, expecting the same consumer who is used to getting everything else with a click of a button to physically step out and go through the exercise of scouting a store to make a purchase may be a little ambitious.

In short, you should be there for your customers no matter where they are or what device they’re using, and you should provide an excellent experience as your shoppers switch from one channel to the next i.e Be Omnipresent  Become an Omnichannel.

3) Running an Omnichannel Store

What is an Omnichannel store? As the name suggests, omni channel relates to establishing multiple channels (ways) of taking your business to the potential customer. For the longest time, retail stores relied on just singular approach of customer reach and that was the physical location of the retail store itself.

But, it is getting more and more uncommon for the modern consumer to rely on just a singular channel to make a purchase. Consumers today research products online, compare prices on their phone, try to discover new stores online, try to test the merchandise in person and then eventually make a purchase in one of the channels. Hence, if the store does not pay attention or lags in these other channels, it is almost certain that the store is invisible to the consumers.

But, what other channels of business exist for the average retail store? This is also a question that deserves some pondering. There are personal websites, social media, ecommerce sites, directory listing sites, m-commerce using chat apps etc etc that exist as a technology worth exploring. But in an apparel retail store`s perspective, the effectiveness of most of these online channels seems to be in question. According to a research by Brand Equity, 95% of shoppers do not prefer to make an apparel purchase Online. Consumers prefer the touch and feel aspect of apparel shopping, also referred to as “Try it before you Buy it” factor. But at the same time, online shopping in apparel amounts to close to 35% of total apparel sales. The only reason 30% of consumers have been purchasing online is because of the convenience offered by the online stores. And this is what retail stores have been missing out on and hence losing sales. Providing convenience of Time, energy, cost and delivery.

4) Taking the Guesswork out of retail

Retail store business, like most businesses relies heavily on more guesswork than it should. Unless one is a maverick store owner, almost everything from sales projections to customer preferences like fashion tastes are all mostly part of educated guesswork at best. While most would like to take this guesswork out of the retail store market, it is only possible to do so if retail stores adopt to newer technological innovations.

Data is the name of the game.

Retail stores interact with thousands of consumers on a regular basis. But apart from the actual sales numbers and the money in the bank, there is hardly any credible data on the potential consumers that the stores seem to care about. Analytics like footfall numbers that did not convert to sale, customer feedback on the certain products, sale number by category and product, tweaking store timings based on exact numbers of customer traffic are some of the data points that help store owners be in complete control of their store.

A simple, yet highly effective way to implement in-store analytics, counters are also used by retailers to measure foot traffic. In a case study about Godiva, ShopperTrak, a retail technology company, discussed how people counters helped increase the chocolatier’s transactions and conversion rates. One of the challenges that Godiva faced was inconsistency in its traffic and conversion numbers. Since some of its stores are situated in tourist areas while others are located in financial districts, its traffic flow and conversion rates weren’t the same for all its branches. To address this, the chocolatier analyzed traffic trends for each individual branch. Doing so gave Godiva actionable insights and it implemented staffing and marketing strategies based on the data it found. ShopperTrak’s foot traffic data enabled the retailer to “plan staff rotas to ensure that there is always a healthy associate to customer ratio and to place the best staff on the shop floor at peak traffic times.” The insights also helped the brand measure the impact of its window displays, and it was able to determine which window merchandising strategies brought in more customers. As a result, the number of in-store transactions went up by 10% and conversion rates increased from 24% to 26.5% in six weeks.

But as a comparatively smaller player in the retail space, what kind of data can a store actually collect that can be useful for the store? Well, according to tech expert David Storm, here are some of the important data points that stores need to pay attention to:

1. Dwell time in the store
2. Average shop times across a particular time of day or day of the year
3. Parts of the store that customers visit the most and the least
4. Where customers live or work in relation to the store
5. Cross-store data comparisons

5) Using Mobile to drive in-store traffic

Convenience that the mobile provides is next to none. As explained in brief earlier, modern day consumers are using their trusty smartphones to assist and guide them towards making an informed choice in shopping. Hence it becomes imperative that store owners use this avenue to lure in potential buyers and improve on the sales numbers.

For an average business the current avenues of consumer interest are

1. Directory Listing websites like Google, Just Dial, Yellow pages, Yelp etc
2. E-commerce direct selling websites like Amazon, Flipkart, Myntra etc
3. Google Search Results and SEO
4. Social Media platforms like Facebook, Instagram etc
5. Websites or web profiles
6. Be active on the hyperlocal sector specific sites like Mainroad.in

6) Boosting Customer Loyalty

With the rise in the number of physical retail stores, change in the consumer mindset and habits and the rise of technology, one of the most severely hit aspects of retail shopping has been the Customer Loyalty or in more colloquial terms “repeat customers”. But if executed in a right manner, customer loyalty is an extremely powerful tool to drive sales growth. This is because a loyal customer is a free marketeer of the business. For anyone who prefers the numbers on this, a traditional word of mouth can spread to roughly 12 people and same when combined with new age social media reach can reach 70 times more number of people, i.e. close to 850 people.

To boost customer loyalty, the more tried and tested methods are things most of us know or have heard at some point- which are coupons, reward points, referral codes etc. But these generic methods seem to have stagnated to garner customer interest as the new age consumer finds rewards irrelevant and the points useless, unless it is something they need.

Hence it is imminent that stores look at innovation to modify their loyalty programmes to better compliment their loyal customers. Here are some ideas from other businesses:

Retailer Sephora has a great loyalty program called Beauty Insider that not only gives members points for every purchase, but also sends birthday gifts, invites to exclusive shopping events, and complimentary beauty classes. On top of that, members of the program can get tailored recommendations based on their profile.

Office Depot is another retailer that’s doing creative things with its loyalty efforts. It started implementing a program that gives customers rewards based on their frequently bought items, shopping behavior, and the amount information that they shared with the brand.  

The aim is to include customized perks and tailored rewards to your loyalty program. This will not only take care of the irrelevant rewards issue that customers have, but it’ll make them feel genuinely rewarded (and in turn more loyal to your brand).

7) Giving customers an experience they wont forget

There are literally thousands of avenues to shop for the type of products you sell. What is the reason that a consumer must come to you and not the other? This is a question that every store that is serious enough about growth and customer retention and sales must constantly ponder over. Do you have superior product that the customer may not find anywhere else? Do you have superior customer service and relationship management that others dont? Are your prices friendlier than the others? Are you more in tune with the fashion trends of the day and hence the customers can expect the best and latest at all times?

As a store owner, the aim must be to answer in the affirmative to not just one but as many of such questions as possible. And once you start getting better at multitude of customer satisfaction segments, the overall customer experience starts getting better. And once the customer experience starts getting better, it has a chain reaction to improving customer loyalty, better customer footfall and thus better conversion to sales.  

Here are some of the ways to improve the overall customer experience and satisfaction which is different from the standard avenues already available:

1. Organize an in-store event! It could be a class, workshop, or just a simple social gathering that’ll give you and your customers a chance to bond.

2. Have a talk with your staff about educating shoppers. Train them to be problem-solvers or advice-givers rather than just salespeople.

3. Explore ways to utilize mobile technology in your store—you have plenty of options! Whether it’s adopting mobile payments, using beacons, or simply offering free Wi-Fi, having a more mobile centric store can make a difference in the customer experience.

4. Step up your tribetailing efforts. If you haven’t done so yet, study your target customers and identify their tribe. Then, evaluate your store and see to it that every component caters to the tribe you want to reach.

Compared to most other segments of retail business, apparel retail is the only segment that still probably functions like how it did since the last 20-30 years. There have been obvious upgrades like the introduction of technology in inventory management, but the basic premise of store-customer relation remains the same. To better illustrate this point, let us have a look at some examples from different sectors of customer use- letters have been upgraded to chat apps, waiting for cabs on the curbside has been upgraded to ordering a cab where you are, discovery of restaurants and eateries has become extremely simple with all the food delivery apps, buying standardised products has become extremely easy with ecommerce sites, ticket booking and hotel accommodations have become easy with a number of travel apps. And yet, apparel retail stores still rely on the age old method of connecting with their potential consumers using what I call “the Honeybee phenomenon”.

 

Heres what the Honeybee phenomenon means:

The honeybee phenomenon is widely seen in in most countries like India where single owner retail stores are omni present and thriving. The way these stores lure potential customers into their stores is exactly the same way flowers attract honey bees in nature- using bright elaborate decorative signage and attractive display of products. Stores literally spend a lot of money just to ‘pimp their rides’ in a way that their storefronts are attractive and eye catchy for the passer by traffic. It basically banks on the law of averages- If there are a hundred people passing by, with such elaborate decor, there is a chance 70 will glance at the store, 50 might find the product display interesting, 30 might walk in, 10 may like what they see and and so on. You get the drill. Keep in mind- nothing is certain. This is all still in a provisional “May” maybe interested, may walk in and may make a purchase.

Thus the location of the store and the display products are the two most important factors that apparel retail stores seem to bank on the most today.

But in the new digital age, there is another factor that has risen to the top, when it comes to customer priority. That is Convenience- while the location of the store and the store display are important components of the success of a retail store business, how convenient can the stores make the entire experience is turning out to be one of the most crucial.

In a research done by mainroad.in, 95% of shoppers said that shopping for apparels online is not their first or the favoured choice. But in terms of sales numbers, online shopping for apparels clocks around 35% of all apparel sales in major metros and big cities. One of the most important reasons why, is the convenience provided by the various ecommerce websites. The convenience of being able to view products where ever they are, at whatever time and to be able to make purchases at a click of a button efficiently taps into the customer`s pockets without them even realising it. But if there is convenience being offered, why do 95% of people still prefer the traditional retail route?

Well, as far as the apparel sector is concerned, one default advantage that the sector has is the ambiguity of the various parameters like size, material quality, the stitching and finish etc and the whole “try it before you buy it” mindset that seems to exist. And it can be assumed that it is because this inherent advantage that majority of people still prefer to shop in a retail store in comparison to online. And to add the customer service and ease of exchanges and alterations, retail stores seem to have enough firepower to take on the exclusively digital apace. But that being said, inorder to achieve market dominance and to stop losing ground to the convenience that the platforms provide, there is an urgent need to adapt, evolve an embrace technology in a way that this blanket of convenience can be effectively adopted into the retail store eco system.

What is this convenience- lets break this down.

As discussed in brief at the beginning of the post, the habits of consumers are changing at a rapid pace after the advent of the smartphone. Everything seems to be just a few clicks away. Hence, after being habituated to this in most of the other chores, there is a subscious buildup of resistance towards anything that takes up more time and energy. That includes the traditional retail store shopping. While the process of picking a product and checking out takes just a few minutes, the process of finding the right product from innumerable stores in the typical trial and error pattern takes 3-4 hours on an average. Because imagine this-
a potential customer`s first step towards finding the right store and the right product is to guess where the right store would be-it could be a shopping mall, a street known for its stores, online websites, anything.
After picking one of these areas, the consumer has to then go and start visiting each and every store that he/she thinks might have products he/she would like. This process generally continues till either time/energy/money is exhausted or the consumer finds what he/she likes. This process is extremely long and tedious for the present day attention deficit shopper and hence needs to be optimised.

What this means is that the customer needs to be able to find the right products in the right stores faster in a more efficient manner. While there are sites like www.mainroad.in that do exactly that for you, since this is a hyperlocal problem, you will probably have to wait till they or someone like them comes to where you are.

But until that time, stores may have to explore other avenues of digitisation that offer convenience. The most dominant and existing options are the directory listing websites like Just dial, Google and Sulekha that offer the consumer, information about your store that they may want. Another way to take your products directly to your customers is through social media websites like facebook and instagram where you could create a store page and upload products there.

One other way that we keep hearing about is by creating your own website. While a website does help in taking the business closer to the consumer, the overhead costs, inventory management and the marketing of the site itself can become an expensive affair. But if a website seems like the way to go for you, there are multiple sites like squarespace.com, shopify.com etc that offer reasonable starting points at creating your storefront online.
But whatever it is, as a retail store owner try to keep your eyes and ears open to where your customers are heading. In short, you should be there for your customers no matter where they are or what device they’re using, and you should provide an excellent experience as your shoppers switch from one channel to the next.

This is 2019. But lets rewind a bit. To the year 2001. Hindustan Unilever Limited (HUL), then called Hindustan Lever limited (HLL), a $620 million Indian subsidiary of Dutch-British company Unilever, launched a service for home delivery of groceries in India called Sangam Direct. Yup in 2001, yup thats much before the ecommerce era and even before social media or smart phones. What  Sangam Direct was in pre-smartphone and pre m-commerce era is what the plethora of online supermarkets like Grofers, Big Basket, Amazon Fresh are trying to tap into today. The Business model was simple. They delivered a printed product catalogue every month by mail. Interested customers just had to go through the catalogue- give the phone number a call to order. And viola! Sangam Direct would deliver your products home the next day. Backed by the deep pockets and assurance of a multinational brand like HUL, Sangam Direct was destined to revolutionise shopping. Or so it was assumed.With hindsight, what HUL failed to factor in was that the early 2000s were the glory days of retail store shopping. People had better jobs, more disposable incomes, Indian markets were starting to open up and shoppers were starting to have access to larger, cheaper and diverse product choice across sectors. But where Sangam Direct failed, another entrepreneur made hay while the sun was shining. The entrepreneur was Kishore Biyani and the business he started in the same year as Sangam Direct was called Big Bazaar. Big Bazaar as it would turn out, had successfully foreseen the retail glory days, got its formula correct and went on to make grocery shopping more of a family outing event. As destiny would have it, HUL sold Sangam Direct service which then pivoted to become a chain of retail stores under new ownership, eventually to change hands again and being taken over by Big Bazaar itself, which was now a huge conglomerate.

While retail store shopping has proven itself to be the firm favourite amongst the Indian shopping diaspora across most ambiguous or unbranded sectors, post smartphone era however, the market indications seem to be suggesting a changing trend of a smartphone addicted, time and energy conscious shopper. Smartphones have no doubt made the world extremely small and made it simpler to accomplish a lot of tasks. But in the bargain, what they have also inculcated is a shorter attention span on everything other than their smartphone screens. While travelling, while waiting at a bus stop, in the middle of a conversation and more importantly for this topic- while shopping, there is a never ending urge of unlocking the phone to glance through the applications without any particular reason. A report by the New York Post suggests that urban population feels the urge to check their smartphones once every 10 minutes i.e over a hundred times a day.

Apparel retail stores in the Indian market rely heavily on luring in their customers in with what I call the Honey bee effect. Here is how it works; Retail stores dress themselves up in bright, eye catchy decor and presentation like a flower does vis.a.vis a honeybee. The aim is to attract the maximum number of bees passing by, thus achieving a greater chance of pollination and survival, or in this case- making a sale. But what if the bees were not looking or heck, bees were busy on their smartphones the whole time? Thats partly the challenge retail stores are facing in this day and age. 

But these multitude of apps on a phone are not some kind of a virus that has taken control of innocent, naive minds. They are there for a reason. They add great value to some aspect of the user`s life. Whether it is their ability to hire a cab, or send messages, get daily news, get food delivered or ecommerce, the smartphone offers the one stop place to keep the user hooked. Hence the direct competition for retail stores today is mostly the hook of the smartphone. Of-course beyond the smartphone, the regular challenges like competition and lack of avenues of marketing and connection with the customer also exist, but they deserve a completely different post altogether.

To treat the smartphone as their arch nemesis or a new age tool to adopt and become friends with is upto every retailer. Our suggestion- the future belongs to the retailer that merges the convenience of the smartphone with the quality and service of the retail store.