Steps to Reopening Retail

As retail emerges from crisis mode and prepares to reset, there are many steps retailers can take now to prepare for the fast-evolving future. Jill Standish, Senior Managing Director and Global Head of Accenture’s Retail practice, shares actionable strategies for outmaneuvering the uncertainty that lies ahead.

How can retailers best support their people as they return to work?

COVID-19 has had a profound impact on people and businesses. Retailers need to understand that employees may still be apprehensive about returning to work after spending time in their homes. In addition, they may be balancing family life which could include home-schooling, caring for young children or elderly family members. This can make them even more fearful of exposure. Today, more than ever, being very human and overly communicative with the staff is a must. It is important to allow for flexibility and agility when it comes to staffing. Tools exist to help with scheduling and empower employees so that they can manage their own shifts and seamlessly exchange with others. Trust and loyalty can be built with store associates when they are empowered to navigate their own personal balance between the demands of home and work.

A second critical element of a human-centric approach is having a clearly defined policy regarding employees who are not ready to come back, so that no one feels pressured to return before they are truly able. If people need to find work elsewhere, there are tools to help connect them with other employment opportunities that better align with their current needs. In addition, we’ve seen retailers use chatbots to assist employees in better understanding their options as well as connecting them with social services which may be able to assist.

What about safety precautions?

The mood has shifted from one of safety to one of trust and confidence. Employees want to know their employer is concerned about their health and wellness and taking visible actions to do so. Communication is more important than ever.

There should be clear and coordinated communication between headquarters, store operations and human resources to the field employees including regional and store managers, and store associates. Partnering with specialists in the healthcare field can also help ensure staff that leaders are consulting with the experts when it comes to questions about safety protocols for both employees and interacting with customers.

In addition to consulting with professionals in healthcare, it is also important to abide by the safety protocols established by the CDC and the local authorities. Policies regarding masks for employees and customers as well as occupancy rules can vary by state. Adopting these will show the employees and customers that you are taking action on the recommendations to support safe shopping.

Should retailers pursue operating model changes?

Absolutely. Retailers need to start at zero. This means taking a zero-based approach for cost optimization in which the budget returns to zero at the beginning of each period and is reformulated only to cover costs that can be justified. This is a good time to reset your baseline with an eye toward future ways of working. Only after can you compare variability in labor and non-labor expense costs across your new store chain. Last year is no longer a good predictor for next.

A driver-based model can help reduce variability by associating costs to specific drivers (for example, foot traffic, store age, department turnover). These insights support a store budget that moves away from using historical comparisons and instead prioritizes activities that add value. Keep asking the tough questions: “Does this activity add value to the customer?” “Is there a more efficient way to do this with technology?” Use cost optimization analytics to conduct dynamic analysis throughout the expected continuous change in the coming months. It is important to understand what’s happening now, predict the future, live the reality, reflect on your experience, and then adjust the model as appropriate. KPIs and measurements play a key role in this.

How should retailers rethink the store portfolio?

Retailers analyzing their balance sheet and assessing fluctuations in demand are wondering if they should reopen 100 percent of stores within their chain. Even before the pandemic, many retailers needed to assess their portfolio. Advanced analytics help to predict shifts in customer demand, ultimately identifying which stores are candidates for either closure or conversion into a lower cost alternative.

This analysis should include non-traditional data sources such as social media, credit card data, shifting demographics and CDC information to inform how shifts in local market demand will influence both the number and type of store needed. Demand and need can help retailers to categorize stores as “permanent closure,” “reopen as is” or “reopen in a new format.” Retailers can use geographic and demographic data to prioritize location, store and region-specific reopen timelines. Developing store-level operating models for each format will give insights into growth/shrink categories, recommendations for format changes, labor and expense costs. Machine learning-based analytics will help retailers to dynamically measure performance against the new model and enable them to rapidly adjust to shifting demand patterns.

What should retailers be doing differently to achieve omnichannel integration?

It’s not surprising that we have seen a huge increase in online shopping. Accenture research shows a significant portion of people newly shopping online intend to do so post the pandemic restrictions. This trend presents an opportunity for retailers to come back stronger and with offerings that serve customers’ new needs and expectations.

During and post-pandemic, the physical retail store network needs to be tightly integrated into digital fulfilment capabilities. Dark stores can be used for curb-side pickup as well as hubs for same-day or next-day deliveries. Retailers should also reimagine the outside experience to account for increased curb-side pickup. What does a touchless retail experience look like—and what changes must a retailer make to deliver it? When a customer pulls into the lot for a pickup order, the experience should be as engaging as shopping in the store. Parking lot navigation is as important as in-store navigation.

Think about each buyer journey. Consider mobile phone integration and enhanced digital signage to guide people. How can the workforce help? Imagine if during downtime, staff were contacting people pulling in for pickup to see if they needed to add anything to their order? Store pickups can become an opportunity for engagement rather than just order fulfilment.

What steps should be taken to prepare the store environment?

Retailers must rethink typical store layouts and traffic flows to allow for proper social distancing, and to minimize congestion and wait times for people entering the store. This means applying “spatial intelligence” so that multiple pathways can be identified as routes throughout the store. There are video analytics capabilities that can assess how people are moving, and pinpoint congestion areas to help identify how the store layout and planograms can be redesigned.

Another important step is to review merchandising strategies. For example, by using advanced analytics, retailers can critically assess SKUs and determine if they are better off streamlining the options they offer customers in-store to have an easier and quicker shopping trip. Perhaps there are some SKUs that should be for curbside pickup only, reserving floor space for items that shoppers prefer to view in person. Creating safe zones and traffic flows requires reimagining in-store assortment and what products should be physically on the floor with the customer, versus delivering some in other omnichannel ways.

After defining the new store layout, retailers will want to put in place a sanitization strategy to make customers feel safe. Customers are seeing manual cleaning, but how do they know that it is effective? There are new technologies to help efficiently and thoroughly sanitize stores. UVC light has been proven effective at killing viruses and presents an opportunity to reduce ongoing costs while instilling confidence in sanitized stores. This is especially important for apparel retailers who are unable to use traditional cleaning methods on garments. XENEX, for example, has developed a robot which creates a halo of UVC light to clean areas. Automating this activity reduces the long-term cost impact while providing assurances to customers that the space is safe to use. These do not need to be massive investments and can be scaled appropriately to the size of the space.

What should retailers be doing to communicate safety measures with customers?

Be loud. Be vocal. Be visible. Customers want to know the space is sanitized.
Communication is important. Consistent and clear messaging across channels and between apps, websites, store signage, social media, loyalty member communications, promotional emails, etc. about protocols and store safety procedures is paramount. For example, some retailers may decide that shoppers need to wear face masks, regardless of local laws. Such information should be communicated clearly across the customer touchpoints—ideally before the shopper gets there. There is nothing worse than the customer arriving at the store to then realize they don’t have the required PPE to enter.

Author: Sacha Brown for CFDA

Photo Credit: Unsplash