The recent demise of many well-known high street brands means that retailers are under increasing pressure to ensure a profitable peak season. With Christmas on the horizon, this will be a big test for retailers, many of whom generate up to 30% of their annual sales during the holiday season.
New figures reveal that today’s high streets will suffer their sharpest decline in Christmas shoppers since the last recession, which demonstrates that brick and mortar retailers urgently need to adapt in order to survive. A combination of increasing rents and business rates, along with the fall of the pound and its knock-on effect on UK shopper spending habits, has resulted in an extremely worrying and turbulent time for the UK retail sector.
The demise of several of Britain’s largest high street retailers, this year alone, has proven that even the most established and long-standing institutions are at risk, and for many, the 2018 peak season has been the last chance for many UK retailers to avoid inevitable collapse. Despite this, figures from Springboard confirmed that this year’s Black Friday sales made little effect to physical stores and drove even more shoppers online.
The question on everyone’s minds is – who will be the next victim in the decline of the high street?
Retailers risk falling behind the tech trend
The retail industry is notorious for being extremely fast paced, and several technological advances over the last decade has put increasing pressure on brick-and-mortar retailers to keep up. In recent years, and in 2018 especially, innovations such as the Internet of Things (IoT) and Artificial Intelligence (AI) have completely transformed the way brands are engaging with their customers. Technologies including in-store tablets, online chatbots and automated processes allow retailers to enhance and personalise the shopping experience by providing added value and convenience to customers.
New technologies such as these have raised the bar when it comes to the level of customer experience retailers are able to provide, but also, the level of experience customers now expect as a result. According to our own research, 67% of shoppers are more likely to shop at a store that integrates technology, and over two-thirds believe retailers that utilise more technology enable a faster shopping experience.
If this wasn’t enough to contend with, consumer purchasing behaviour is changing. Shoppers want high quality products at the best possible price, as soon as they can get it, and are taking their shopping online to achieve this. Online shopping means consumers can beat the peak season queues and purchase items instantly and conveniently. In fact, according to a survey by PwC, 67% of shoppers will be completing their Christmas shopping using just their laptop or desktop, and 29% will be using their mobile phone to purchase Christmas presents.
Gearing for success
While disruptive technologies such as augmented reality and drone delivery have been pegged as the future in the retail industry, experts agree that the technology that is changing retail is not the overhyped stuff of tomorrow, but the more mundane things that are happening today. To succeed this peak season, rather than competing against the online world of e-commerce, retailers should be adopting the right strategies to complement and accommodate changing shopping habits.
For the brick-and-mortar retailer, technology such as digital signage, kiosks and tablet scanners help shoppers find what they are looking for, while Mobile Point of Sale (mPOS) and self-checkout terminals make payment quick and easy. Retailers must consider applying a mobile-first strategy across their entire on and offline operations to streamline the value chain, from supply to distribution to shop floor. Barcodes and RFID are key enabling technologies for warehouse management systems. Knowing exactly where items are located and in what amount is essential when preparing for peak season trading and allows companies to shrink their inventory and increase product velocity through the supply chain.
Retailers should be offering personalised services, and mobilising retail staff through technology to streamline intelligent customer interactions. If store retailers want to remain competitive in today’s volatile climate, they need to be agile and adopt an integrated system that makes online to in-store transactions seamless.
Minimising downtime – maximising profits
However, with new technology comes new challenges. As retailers deploy more in-store technology, they are intensifying many of their existing mobility management challenges and introducing many new ones. If a fault should occur during peak season, companies need to find and fix touchpoint and app problems as quickly as possible to reduce downtime. Failure to react quickly can impact negatively on customer satisfaction and sales. This would be a catastrophic disaster for retailers normally, let alone over retail’s busiest period.
To combat this companies must implement a robust and secure integrated solution to ensure seamless integration across both online and offline channels and create an omnichannel shopping experience for their customers. Whether the consumer chooses to purchase in-store, online from a desktop or mobile device, or a combination of both, the customer experience must be seamless and consistent. Retailers who do not support these advancing methods of shopping that include technology effectively could risk being the high street’s next casualty.