COVID-19 has had devastating economic impacts especially on the retail industry. Instead of falling back on old ways of doing business, retailers need market intelligence in order to thrive in the new world of retailing.
As one of the most impacted sectors by COVID-19, the retail industry is adapting to brave this new world where consumer behavior and needs have changed drastically. Based on past crises such as the 2008 Great Recession, investment into data and technology resources can create the opportunities needed to restore a business without sacrificing any more margins. We briefly cover the 5 key areas retailers need to invest in. Download the full report in the banner below.
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1. Online innovation
Due to the restrictions from lockdown measures, shuttered stores meant an increased dependence on e-commerce channels. Retailers acted quickly by experimenting with a variety of ways to re-engage with their customers in the wake of COVID-19. Companies such as Revolve have partnered with Style+Snap to offer customers more access with stylists through digital communication. While Facebook is in the works of developing an AI learning machine known as Fashion++, which will offer styling suggestions to users. Move over Tan France, Fashion++ will be doing the French tucking from now.
These quick technological solutions may satisfy customers in the short run, but retail intelligence on the industry is pertinent to stay competitive in today’s retail landscape. Since COVID-19 has disrupted the retail calendar, it has impacted decision making as we’ve seen demand for fashionable PPE rise and vacationwear fall during a time when summer assortment is usually selling out quickly. With the power of real-time data, retailers are able to react quickly to see these types of patterns or readjust any discrepancies in their current strategies.
2. Reimagined retail spaces
Reopening physical stores means a drastic change to how they used to look pre-coronavirus as considerations to in-store social distancing and hygiene needs to be top of mind. Macy’s and Nordstrom are two legacy department stores who plan to reopen with plexiglass barriers at registers and card-only transactions.
Most importantly, brands that can offer an easy and efficient return process will retain loyal customers. Although online returns are a costly pain point, there are platforms such as Returnly who specialize in reverse logistics to save time and money.
3. A.I. and analytics
Currently, less than 20% of retailers use AI even though data analytics can fill in the gaps to the industry’s lack of knowledge in traditional product development cycles. With a majority of retail stores still closed, transparency and understanding of the e-commerce landscape with data and other emerging AI technologies will help boost online sales and instill confidence in customers to continue to shop. Between AR sizing and 3D fitting technology, retail is slowly adapting to maintain customer loyalty and interest is still there.
In March, Shopify allowed its customers to start adding 3D models to product pages and found conversion rates to increase by 250% when users use the AR filter. Rebecca Minkoff, who has been experimenting with Shopify’s 3D model, found that customers who interacted with the model were 44% more likely to add a product to their cart and 27% more likely to complete the purchase.
4. Market data and intelligence
As work-from-home policies become the norm for many companies in a post-COVID world, streamlining insights across teams is essential to spot costs and opportunities that can save a business. And while internal data is useful, that’s only half of the story. Market intelligence with AI and data at scale is critical in this new retail climate.
For example, Buyers no longer have the option to do manual comp shops, travel to different countries and see what consumers are buying anymore. Instead, they have to rely on online insights and data to decide what their business should be selling compared to the competition. When used strategically, AI and data resources such as the EDITED COVID-19 Retail Analysis Dashboard can help retailers optimize current processes as well as increase revenue.
5. Communication and transparency
As we shift our focus from the retail apocalypse to the oncoming recession, it’s more important than ever for retailers to understand shifts in consumer behavior and buying habits. Leverage technology to engage consumers and ensure they feel connected to the brands they’re buying from.
While spending habits will tighten, transparency on sustainability, hygiene and safety measures will be paramount as consumers choose to support brands that align with their key values.
Despite the uncertainty that continues to loom over the industry, retailers who are equipped with the right tools such as market intelligence are working more efficiently and re-emerging stronger into the new era of retail.
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Daphne Duong
