June 8 2020
Now that stores are opening again, we are all more or less getting used to the new normal in retail. Driven by reality, consumer behaviour is swiftly adopting online shopping. It seems to be safe to say that significant opportunities for the future of retail are digital – this has not only been true since ‘Corona.’ Shoppers spend much of their time with their smartphones, using news feeds, social media, and shopping apps. This became just drastically obvious in the time of the shutdown of stores and showed how vital digital sales channels are.
No matter how the exact development will be, one thing seems to be sure: the role of stores is (ever) changing. Of course, stores will always be a place where people come together. However, there is another aspect arising. Stores will act as a ‘mini DC,’ ‘micro hub,’ or ‘Omni-fulfillment centre.’ Name it as you want; the symbiotic relation becomes more and more apparent: e-commerce needs stores, and stores need e-commerce!
New technologies can aid in "social-distance selling" by helping retailers limit physical contact, reduce time spent in stores, avoid large groups of people, and even utilize stores to fulfill online orders
Vogue Business
Short-term 'new normal': line up, wait and be safe
Many countries and regions around the globe are 'restarting' and allow stores to open again. Especially fashion retailers expect another boost in sales and frequency when restaurants are opening as well. These days, stores have to react agilely to new regulations and the individual needs of the customers. It has become a reality that restrictions, especially distance rules, will continue for a more extended period to guarantee employee and customer safety.
- Mobile checkout: the "contactless" becomes a necessity – especially when it comes to (mobile) payments. Here, RFID can be used for security purposes to keep track of the status of an item, e.g., if a specific item is sold or not. Mobile checkouts can eliminate queues, drive higher conversions, and offer a seamless shopping experience. Read more.
- Product quarantine after fitting: for fashion retailers, it is a challenge that customers might be afraid of infection from touching items or using the fitting rooms. RFID technology can also help here. With its capability to identify products on a unique item level, a retailer can track when a product has been returned and set a timer to ensure that the product is put on display after a certain quarantine time.
Mid-term 'new normal': trust, sustainability, and confidence
In times when consumers will shop more consciously, the focus is on sustainability and quality. Also, shopping goes back to local. People buy locally and don't necessarily drive to the next big city. There is a high loyalty to local stores, where customers feel familiar, where they know the faces, and can expect trusted advice.
In terms of sustainability, longevity is crucial. Customers want to wear the products for longer, trust the quality and its provenance. Especially in the world of online commerce, it's a challenge to keep track of the origin of products, since the distribution channels are often anonymous.
- Product authenticity: a (real-time) tracking & tracing of the products, e.g., with RFID, can help to stay ahead of the product's flow and guarantee where it's coming from and if it is authentic.
- Reduce waste & emissions: a high stock accuracy, based on RFID, can help to reduce safety stocks and thus reduce waste. Additionally, products can be shipped from the store that is closest to the customer. This minimizes the number of miles from the vendor to the consumer.
Note: our webinar about "RFID & Sustainability" will further elaborate on that topic. Check it out here.
Long-term 'new normal': online takes centre stage
Promoting the store's stock in an online marketplace is creating a lot of additional sales opportunities. Consequently, it is necessary to bring stocks online. Digital and analytics can not only drive top-line growth. It also significantly improves speed, cost, flexibility, and sustainability across the supply chain. This means that a fully integrated management of stock in stores and warehouses is core to any omnichannel operation. Making all stock visible to customers on any channel has proved to boost sales.
- Unified stock pool: with full stock visibility, retailers can quickly fulfil online orders and even boost sales of full-priced items. RFID technology is the foundation for accurate stock information as it makes it possible to automate the in-store stock management – resulting in a near 100% in-store stock accuracy. Read more.
Stores are transforming into 'micro DCs,' small and local fulfilment centres that make sure to fulfil orders wherever they are coming from.
Stores are becoming "micro DCs"
In a world where physical distancing continues, shoppers are reducing their visits to brick-and-mortar stores. As a result, e-commerce and automation are rising. I notice that retailers start to restructure their stores, especially by rededicating floor space to storage. This enables them to use it for the fulfilment of online orders. It looks like stores are becoming 'micro DCs,' small and local fulfilment centres that make sure to fulfil orders wherever they are coming from. This model allows retailers to continue to make sales while limiting the number of people who are in the store at one time. For the consumer, the main benefit is that shipping times are much shorter as items are shipped from the closest store.
RFID business expert
Tom Vieweger
