For retail chains, the bricks continue to crumble: Declining sales, shrinking margins and the inevitable closing of physical stores. Need proof? Just look at Sears, Macy’s, Kmart or J.C. Penney.
Yet even with the sirens at full blare, traditional retail is failing to move quickly to meet the changing expectations of today’s shopper. While the solution to staving off the hungry wolf of Amazon seems simple – hello, mobile and e-commerce! – the journey has proven anything but.
One place brick-and-mortar retailers can start is by reimagining their biggest and most maligned asset: Physical stores themselves.
The Next Era of Connected Retail
Hundreds of thousands of physical stores have been built over decades, involving massive investment. Today, they represent a competitive advantage just waiting to be marshaled. Yet most operate today based on a consumer behavior that’s in rapid decline: Walking into a store, finding items on shelves and waiting in checkout lines. Most retailers haven’t invested in the technology that will transform stores in the new era of retail; others are spending money on the wrong technology.
When local stores are newly configured as hybrid stores and fulfillment centers, major retailers’ investments in physical stores are defensible and very difficult for pure-play ecommerce to match. Mobile commerce favors immediacy, and having goods locally lowers fulfillment costs.
To take advantage of these opportunities, here are some tips for brick-and-mortar retailers looking to beat back the industry shock wave:
Quickly enable stores to fulfill mobile orders
Nothing is speedier or more economical than going to a local store to get consumers the goods they want fast, either overnight or same day. There are no delivery windows, shipping fees or marked-up prices.
Embracing the right set of technologies for the next era of connected retail is imperative. Yet the ability to search and browse products at local stores with a seamless experience from an app or web browser is largely nonexistent. According to a LexisNexis study that polled more than 1,000 U.S. merchants, only 16% of them have a mobile shopping channel and just 32% are thinking of adding one in the next year. Amazon’s unsexy yet consistent and speedy interfaces, together with its reliable fulfillment, confer an advantage that even the most digitally savvy retailers have yet to match.
Learn to execute mobile ordering flawlessly, without the friction that has handcuffed those attempting it so far, and you’ll draw shoppers back to stores. But the clock is ticking: By 2020 mobile commerce will be an estimated $284 billion market, or 45% of total U.S. ecommerce.
Go on the offensive
Brick-and-mortar retailers can leverage their proximity to the consumer to make goods ready FASTER – “pizza delivery time” fulfillment in less than 30 minutes. Having goods ready that quickly provides an experience that is impossible for Amazon or other pure-play online services to match in a cost-effective way.
That means finding ways to equip workers with tools that help pick and pack effectively, without adding extra burden to their current workload, and integrating with delivery services like Uber or Postmates to bring customers what they want when they want it from the nearest store.
Conduct fulfillment flawlessly
For the consumer, connected retail blends the digital and the physical in a shopping experience that meets the needs of their hectic, on-the-go lifestyle. That means having a mobile shopping experience with a seamless, one-click checkout with instantaneous fulfillment.
You need to put in place sound arrival detection technology that reliably tells store associates when customers are on approach – without draining their phone battery – so they can meet them with their order the moment they pull up to the curb or step up to the counter for their online order. Also, experiment with new in-store experiences to draw shoppers in, like Nordstrom’s Reserve & Try, where customers select merchandise via mobile and have it hanging on the dressing room door with their name when they arrive.
The Bottom Line
Store closures are going to get worse before they get better. Change requires a willingness to fundamentally shift mindsets and a full-on commitment to update the technological infrastructure currently powering stores. There is much work to be done to innovate beyond legacy fulfillment systems and encourage internal teams to work together across digital and in-store experiences.
More than anything, connected retail requires an integrated system with two seamless touchpoints – perfect online and perfect in-store experiences. Retailers that move quickly will thrive, while those that don’t will be hanging “For Lease” signs in the window in the not-too-distant future.
Jaron Waldman is the co-founder and CEO of Curbside