Retailers must view their challenges as opportunities to achieve future business success
The pandemic has impacted all areas of business. Companies had to pivot overnight and remain agile to navigate the evolving pandemic. A sector that was particularly impacted was retail – with shops closed and highstreets deserted, eCommerce became the only option to keep brands alive.
For almost two years now, retail leaders have overcome furloughing and redundancies, and are now battling talent shortages and supply chain issues, whilst the threat of further lockdown measures is ever-present. However, these challenges don’t necessarily present more negatives. Instead, this pressure to adapt and futureproof brings new opportunities for future success. We recently surveyed more than 250 UK retail leaders and over 2,000 consumers to understand these opportunities and 2022 predictions for our whitepaper: Talent, convenience, and technology: The Retailer’s guide for 2022.
Making changes to attract talent
‘The Great Resignation’ has been cited across many industries as the pandemic offered the workforce time to reassess their careers. Securing great talent is always competitive, but with this increased staff movement and skills shortages expected to continue well into 2022, our research shows 94% of retail leaders are concerned about talent shortages within their business. For those in the clothing, attractions, and automotive sectors of retail, this peaks at 100%.
The leading cause for these shortages is talent making career changes out of retail into other industries (38%), followed closely by a lack of correctly skilled people (37%) and employees, as a result of the pandemic, experiencing poor mental health or burnout (37%). Alongside this, retail leaders’ top challenge is sourcing employees that plan to stay with the business long-term (39%). There is also competition from other brands (37%) and sifting through a large number of applications to find the correctly skilled talent (36%) to contend with.
However, retailers can use this knowledge to make their industry more appealing to the right talent. From improving wages and committing to overhauling shift management to empowering training and development processes and supporting mental health, retail leaders that make these changes will soon attract talent that is committed to the long-term future success of the business – no matter how the pandemic impacts it.
Navigating the new highstreet
Many consumers willingly returned to the highstreet as pandemic restrictions lifted in 2021. People claimed back retail therapy via physical shops whilst still enjoying the perks of eCommerce, with our research suggesting that most consumers found a balance with both online and in-store shopping (65%). A further 19% even shopped in-store only. However, with restrictions creeping into 2022 the concern is that retail leaders will face fresh challenges that could further impact bottom lines.
Arguably the most important element here is safety. Keeping the shop floor safe for both customers and employees was a significant challenge as retail began to resume a physical presence in 2021 (26%) and it will remain so this year (35%). However, the processes put into place last year are expected to boost consumers’ confidence in physical retail with 75% of consumers feeling shops have made customer safety a priority. For retailers, this means they can continue those measures and prioritise other areas that need attention – such as unpredictable consumer demand vs the right staffing levels for quality customer service – without impacting customers’ perception of retail safety.
Prioritising operational technology
The pandemic fast-tracked digital transformation efforts. In retail, technology evolved both in-store and back-office. However, with the sheer amount of exciting innovations available it’s hard to know where retail leaders should be directing budgets. Are augmented reality (AR) installations worth the hype or is the budget better spent on a workforce management platform that impacts the customer experience?
Consumers are keen for retail brands to offer a sophisticated eCommerce experience (37%) whilst the option of contactless payments (35%) and loyalty apps with enticing offers (34%) are a close second priority. However, cashier-less checkouts, chatbots, and AR are all falling flat with consumers preferring quality customer service and the opportunity to secure a great deal. Creative concepts will bring a new reality to the highstreet but retail leaders mustn’t drop the functional basics for shiny new toys.
Encouragingly, most retailers plan to prioritise relying on and investing in back-office operational technology to automate processes (34%), while implementing new in-store technology is slightly further down the list of priorities for 2022 (31%). The most important tech solutions for retail businesses this year are expected to be workforce management technology (40%), employee engagement technology (39%) and customer loyalty technology (38%). After 2021’s focus on eCommerce, it’s no surprise that all of those will be prioritised over improvements or additions to online retail tech.
Ultimately, retail leaders will need to look at their challenges as opportunities in 2022 in order to remain competitive and navigate the ongoing talent war, eCommerce pressure, and customer experience and safety challenges.