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The unexpected shifts in retail you can expect in 2022

The unexpected shifts in retail you can expect in 2022

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Over the past two years, eCommerce has come out on top as the hero channel amid the pandemic. While retail players saw dwindling footfall and hard-hit revenues, many brands saw eCommerce as a solution to their problems.

According to estimates in an UNCTAD report published on 3 May 2021, the dramatic rise in eCommerce, amid movement restrictions induced by COVID-19, increased the online retail sales’ share of total retail sales from 16% to 19% in 2020. The report added that global eCommerce sales jumped to $26.7 trillion in 2019, up 4% from 2018, and this includes business-to-business and business-to-consumer sales.

But despite the possibilities presented by eCommerce, simply banking on one channel over another cannot be the answer, said Daniel Hagos, managing director of Greater China and Southeast Asia at Emarsys. The solution lies in having an omni-channel approach.

In a roundtable discussion with MARKETING-INTERACTIVE, created in collaboration with Emarsys, Hagos said what has been evident in the past year is that technology should be the fuel that powers the retail revolution. One clear area technology has room to make an impact on is in empowering on-ground staff.

As we move towards 2022, he and the team at Emarsys predict that in the next 12 months the role of retail staff will drastically evolve.

“Previously retail staff were just the offline face of the brand but they will go through a 2.0 shift where they’ll represent a customers engagement with a brand offline and online. There’s going to be a sort of evolution in their roles,” he said, adding:

What I find really interesting is how technology is improving the role for the retail staff so that they can understand the customer better in-store – be it their purchase habits, complaints or queries.

Nonetheless, at present, in many emerging economies, retail staff are still running blind to who the customer walking through the door really is.

The friction remains

While one way to counter the retail staff’s lack of knowledge of the consumer might be through the integration of tech solutions within the store, and omni-channel thinking, the realities on ground don’t necessarily always reflect the concepts discussed in the boardrooms for a better customer experience.

Friction between retail and eCommerce teams remains a reality in many markets where the two are viewed in competition.

“Retail staff should be commended if a consumer walks into a retail store and chooses to later purchase a product online. Clearly, it shows the retail staff has done his/her job well,” he said.

But this requires a “top-down shift in mindset” – and is often easier discussed in theory than in practice.

Agreeing with him was Jia Ming Cheah, CEO of Golden Scoop, which operates Baskin-Robbins in Singapore and Malaysia. Cheah said before the pandemic, the retail teams at Baskin-Robbins were a driving force behind the company’s growth, with the majority of revenue clearly coming in from on-site retail.   

However, during the pandemic, delivery transactions became a significant contributor in place of the on-site retail transactions. The company had to quickly pivot and restructure its teams to operations and sales-led teams. He explained:

We also had to then educate our staff and teams on an omni-channel strategy which for many is a new area.

“We needed to ensure our teams were united and seamless. Before the pandemic, we had different teams taking care of their own share and didn’t need to work with each other, so we’ve now had to restructure the team to mainly sales and operations to break down the silos.”

Meanwhile, Chou Loong Bok, head of eCommerce at Bata Primavera, said that over the past year the brand had also made headway into the marketplace and recently upgraded its website to offer an enhanced digital shopping experience. Offering a hybrid eCommerce model, customers are now given the option to click and collect at a preferred Bata store.

While an initial challenge for Bok was in convincing teams the investment into marketplaces would pay off given Bata has long been a retail-heavy brand, he added marketers needed to drive that change in mindset from management. The brand needs to step forward and embrace new channel strategies as it allows companies to compete better in an economic environment that is constantly changing in response to technology evolutions.

“Bata is a brand many people are familiar with within the retail space, but for us, when stepping into the marketplace, we felt like a fairly new player and needed to learn the traits of digitalisation and explore new marketing approaches. A lot of effort and challenges along the way but learn as we go. Plus, our new CEO, Sandeep Kataria is from a strong digital background therefore we are embracing technology faster than usual,” he said.

He said Bata is now actively building its brand online and he works closely with the marketing team to build its presence online and has even ventured into working with influencers.

An entry into the unexpected

Trixie Khong, CEO and founder of jewellery brand By Invite Only, took a rather unconventional route. She explained the pandemic enabled her the opportunity to expand her brand more aggressively into the retail space. Today, she has five stores, compared with three years ago where there were none. She said:

We have always been online and we transferred into this omni-channel model and also opened up in retail.

Khong added that during COVID-19, with mall owners being equally impacted, many were open to having conversations with brands such as hers which were up and coming names.

“The barrier of entry was finally lowered, and I guess small brands are now pushing through the ceiling that we really wanted to push through. And we found many spaces had very attractive rates, and mall operators were very accommodating to a lot of our requests,” she said.

Meanwhile, because of the brand’s digital presence, she said it could also use its pull factor to draw in consumers to the mall. “So even though the mall is quiet, we pulled our customers to the store,” she said.

Kevin Huang, managing director of Carousell Hong Kong, added that in Hong Kong, a similar trend was noticed during the pandemic where brands, which started off online, expanded their presence in retail, be it through permanent shops or just pop-up stores.

“Landlords are more accommodating to rents which are now cheaper, and at the end of the day, it’s actually a great branding presence. Moreover, brands also actually get to meet their customers in person,” he said.

Echoing similar sentiments, Cheah added that while investing in digital is a given amid the pandemic, Baskin-Robbins is also looking to grow its OOH presence.

“When people come out and they start travelling, it will be a fresh new feeling. So I think coming out to drive and to see billboards and OOH ads will be a new feeling for a lot of people,” he said.

Like Khong and Huang, he added that even media owners in OOH spaces have also been hit by the pandemic, and as such, the rates offered for ad spaces have also become competitive as compared with digital.

Emarsys will be speaking at MARKETING-INTERACTIVE’s upcoming Omnichannel Marketing Asia conference on 23 November 2021 at Hotel Icon.

(Photo courtesy: 123rf)

 

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