Lockdowns may be easing, but COVID-19 still brings many challenges to all businesses, including those in the retail world. While we wait for either potential vaccines or for the disease to die out, these issues will continue to present themselves.
One thing we are already sure of is that this is not going to be a short-term situation. Long-term solutions to these challenges are needed. Retailers will need to invest in strategies that will help them to cope.
5 key COVID-19 challenges
These are five of the most significant challenges for business leaders right now:
1. Lower spending
Customer shopping habits have doubtlessly changed. A survey of Emirati shoppers revealed that many had reduced their spending in all areas other than household essentials. There are various explanations for this, including declining incomes and financial wariness. Many people have lost jobs or faced reductions in salary or self-employed income.
2. Reduced customer footfall
Visits to brick-and-mortar stores are at very low levels. Social distancing is being strongly encouraged by governments across the MENA region and people are thinking carefully about the necessity of visiting stores. According to recent survey data, 65% of consumers are hesitant to visit stores.
3. Knowing how to inspire greater consumer confidence
The prevalence of the coronavirus is still high enough in many locations for consumers to be fearful of coming into contact with it and to avoid retail outlets. However, this fear can be overcome if people feel that a store has good safety measures in places. Over 40% of consumers are more likely to visit a store if they know it is making significant efforts to prioritize customer safety.
A key challenge for stores is first to put the right safety measures in place, and then to ensure they are communicated effectively. Inspiring consumer confidence is vital in the current climate.
4. Changes in consumer behavior
The sudden changes brought about by the pandemic crisis have undermined everything retail outlets thought they knew about their customers. It has been very hard to predict shopping and spending patterns. Therefore, producing personalized recommendations and loyalty program offers has been difficult. This has had a further impact on revenue and profits.
Furthermore, retailers have found this unpredictability has affected their ability to maintain inventories and appropriate stock levels.
5. Shift to online shopping
Throughout this crisis, many people have felt safer shopping online and found it more convenient. Without the fear associated with being out in a public space, consumers will be more likely to browse online than in-store. This is where impulse buys are happening. In-store shopping is more targeted and efficient right now.
Reasons for optimism
The retail world may have been turned upside down; however, there are plenty of reasons to remain optimistic. There are potential solutions to the problems above, but they require investment and flexibility.
One of the ways retailers will need to move forward is through reassessing and relearning their customer behavior. This can be accomplished quickly by measuring footfall traffic and using data analytics.
Counting solution providers enable retailers to monitor attendance and movement through their spaces through various technologies. These can include infra-red beam or laser sensors, video-based image referencing sensors, thermal heat detection sensors, or shape recognition technology.
Why monitor footfall data?
There are various compelling reasons that make this a crucial time to start tracking store footfall. Here’s why:
● To improve safety
As already explained, it really is vital right now to ensure customer safety by making sure stores do not become overcrowded. Consumers really need to feel that they will be safe before they consider visiting a store. Additionally, retail spaces need to ensure they are operating according to their government regulations for COVID-19 safety and may need to limit numbers.
Monitoring real-time footfall data both into the store and around internal areas can ensure that this can happen. It is possible to always be able to provide an accurate figure for how many people are using the retail space. These numbers allow both you and your customers to get a clear picture of how busy the store is and make informed decisions. This will inspire consumer confidence greatly as you clearly demonstrate that you put people before profit.
● To improve customer experience
You can also use footfall data to provide real-time information on estimated wait times. In fact, it is possible to use footfall data to improve customer experience in many ways.
You will be able to pinpoint exactly where you need to deploy your most critical resources (time and people) at any given time. This can be enabled through heat mapping or path tracking technology. Use the figures to adapt staff scheduling and manage staff movement around the store.
● To make quicker, better strategic decisions
Footfall data allows you to explore conversion rates, department by department. Understanding store conversion rates are the best way to assess the effectiveness of product placement and marketing campaigns.
Having this kind of data allows you to make agile decisions on strategy. Use heat mapping and path tracking to identify “hot” and “cold” product areas. It then becomes easy to identify emerging consumer patterns and trends and act upon them quickly.
● To collect meaningful data long-term
While you can easily get started and make use of footfall data immediately, the accumulation of data long-term also has far-reaching benefits. Combined with other metrics, it can help provide a crucial understanding of brand and product performance over time. Track data such as visitors by days, visit duration, or sales vs traffic. You can use this information to inform promotions and seasonal offers, for instance.
It is also possible to monitor footfall passing a store as well as that which passes through the doors. This gives you valuable insight into lost opportunities.
Retail post-COVID-19
The pandemic has changed retail, and not just temporarily. We are bound to be feeling the aftershocks for many years to come. The only way to be sure you are on top of understanding new customer preferences and trends as they evolve is to have access to footfall data and data analytics. This can give you real-time information to inform short- and longer-term planning and to enhance your customer experience.
Not only do you get to be agile in terms of strategy, but you can also use the data to keep both your staff and customers safe and your business operating smoothly and efficiently at this difficult time. Footfall data is likely to be the best investment you could make right now.
AUTHOR BIO
Vic Bageria is the Founder and CEO of Sávant Data System LLC, a retail solutions and services provider focused on empowering businesses with progressive technology solutions such as People Counting and In-Store Analytics to improve operational efficiency and profitability (such as provided by Xpandretail powered by Savant). Vic is an award-winning entrepreneur and visionary, with experience in building recurring revenue technology businesses, who has mastered the intersection of technology, consumer marketing, customer behavior and instore insights.
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