Retail New Normal: how can Fashion and Food & Grocery create contactless but valuable relationships?

Chief marketing and sales officers from all industries are at the forefront of defining the Digital transformation and Covid-19: what are retailers' priorities?  “New Normal”, due to the impact that the enormous changes in customer behavior caused by Covid-19 are having and will have on consumption and interaction models. These changes are not, for the most part, transitory, but will rather become new habits and therefore dictate the creation of new business models.

There may indeed be long-lasting changes in consumer behavior in terms of physical distancing, health and privacy, elements which affect not only their safety but also their own customer experience and the way they relate to companies and brands, both in B2C and B2B relationships.

While it may be true that the Coronavirus has first and foremost accelerated innovation in the workplace, creating new employee interactions and making smart- and remote-working essential in guaranteeing business continuity for companies thanks to the creation of digital workplaces in record times, the real long-term challenge lies in the creation of new ways of interacting with customers, putting the Sales&Marketing Digital Transformation roadmap to the test once again.

Surviving and being competitive in the New Normal or Next Normal will mean being fast to understand and capitalize on the new key values for customers and knowing how to read the new customer journeys, setting out a new model for decision-making and consumer preferences, which are today influenced not only by price, but also trust and therefore the ability of companies to build a personalized relationship with their interlocutor

Retailers have once again been the first to have to take these new behaviors into account, and consumers immediately adopted a Digital First approach, favoring purchases from online stores and placing their trust in companies who have been able to create contactless interactions, in order to minimize risk, but which are nevertheless human-centered.

Digitization both of the product discovery and experience phase, which ranges from consulting an extensive and up-to-date online digital catalog, to real-time remote interactions with store assistants, right through to innovations such as virtual try-on and virtual fitting rooms, and of the supply chain processes which allow delivery of the product to the customer where, when and how they require it, convey a sense of greater connection to the customer: an inestimable distinctive value.

Up to 40% of consumers changed store and brands during the lockdown, and many will probably choose to maintain their new habits.

In the new way of relating to the changing requirements of their customers, retailers need to put themselves to the test by innovating in terms of their promotions, prices and range, with convincing value messages; this will not be enough, however.

The retailers' priority will be to optimize e-commerce channels and omni-channel functionality with the goal of achieving unified commerce, putting the customer in the center for a unique experience in terms of engagement, product and transaction thanks to omni-channel inventory visibility and Digital Customer Engagement and CRM solutions. The integration of Advanced Analytics, Big Data and AI techniques will, at the same time, be key in customizing primarily relationships with customers and rebuilding a loyalty pathway.

In terms of Sales&Marketing logic, the challenge is enormous, with the top management of the Digital and Retail sectors required to make both short- and long-term strategic decisions.

With a significant decrease in the tactile product experience and try-on, which are still so important for the fashion&retail customer experience, customers now have a greater need than ever before to find all product information online, from the more technical data (materials, sizing etc.) to product storytelling: an extensive and up-to-date digital catalog which is able to distribute consistent product information for all digital touchpoints, from proprietary e-commerce to the various fashion&luxury marketplaces, is now essential in allowing a genuinely “informed” online purchase.

A digitized product description on all direct and indirect digital channels made possible thanks to the digital catalog and PIM, and access to stock information on all channels and logistics centers, updated and shared in real time with the end customer through the e-commerce system and the OMS are therefore becoming the key factors allowing success of a Digital First experience in a historically “high-contact” sector such as fashion.

Home delivery is becoming the favored method and the one to invest in, in terms of reliability of the actually available references and optimization of delivery times to the customer: real-time inventory visibility for products on all the retailer's touchpoints, made possible by innovative Omni-channel Order Management (OMS) solutions, allows customers to have the product in their desired location in the shortest possible time.

This is the concept of the “endless aisle”, made possible by unified commerce solutions which create a genuinely omni-channel and seamless experience that allows purchasing of a product to be performed anywhere thanks to real-time visibility of stock availability for all logistics centers, from proprietary warehouses to bricks-and-mortar stores.

The stores of fashion industry retailers are, indeed, suffering some of the most serious impacts from Covid-19, first with the lockdown and now with social distancing requirements. In the New Normal, the role of POSs will be extremely dynamic: while the direct and physical product experience has inevitably already been reduced, fashion retailers will have to understand customer preferences and define a new role for their stores on the base of them and the new guidelines to limit transmission. From showrooms to nodes in the supply and delivery chain, stores are turning into places of product availability, warehouses to all intents and purposes.

With real-time inventory visibility for all online and physical locations, mobile commerce is also acquiring new significance: customers who wish to go to the store will check the stock in the nearest store on their device in order to optimize their contact time and therefore their experience, making use of functionalities such as the reserve store, and making an appointment with the store assistant. Within the store, mobile checkout will further optimize the time required to finalize the purchase, and it is precisely thanks to the Mobile POS that contactless interaction and purchasing will become possible without negative impacts on the relationship between the customer and store assistant.

Store assistants, long a privileged customer relationship channel in the fashion&luxury sector, are seeing their role reinvented in turn, although this does not necessarily mean a cooling of relations: thanks to Clienteling & CRM solutions they can have access to customer data generated both offline and online (from purchase behavior to loyalty data) and personalize their interactions with the customer as a consequence, giving greater value to the Customer Engagement and follow up activities thanks to marketing automation flows which aim to optimize cross-selling and up-selling, as well as reinforcing customer loyalty.

Access to stock information for every channel and logistics center, which is updated and shared in real time with both the end customer and the store assistant, is clearly the basis for a new relationship between retail fashion brands and their customers, in which the distance between the product and customer seems to disappear precisely thanks to the variety of possible sales channels.

E-commerce for major supermarket (grocery) chains saw a sudden and significant increase during the lockdown phase, which placed the entire supply chain under stress. Most food retailers were not structured to manage home delivery or in-store pick-up of online orders, methods chosen by many customers to limit the risks to their health, guarantee social distancing and in any case made mandatory in many cases due to limited capacities under the new rules.   

Many players immediately understood the priority of optimizing product picking in stores or warehouses, both for those making click-and-collect orders and for home deliveries.

The picking and delivery processes indeed involve most of the costs for online shopping and have the greatest impact on the profitability of the service, above all in the grocery sector. Optimizing product picking through dedicated digital solutions (Picking Apps) and planning home delivery routes through Distributed Order Management and Logistics App solutions therefore allows food retailers to capitalize on the investment in their e-commerce platform and, above all, to create an ever-better customer experience which builds customer loyalty.

In order to allow online purchasing in a sector which was little accustomed to digital sales in Italy, the first step is, naturally, once again to digitize the product catalog using shared and recognized market standards (GDSN), allowing consumers to access high-quality information on the end product, genuinely improving their purchase experience.

If digital first and digital self-service, contactless to the greatest possible extent, are at the center of the customer experience in the grocery sector, it is thanks to machine learning and big data analysis that it is possible to foresee issues in the supply chain to identify them and adapt rapidly.

Speed and the ability to innovate, enhancing the customer experience, are the factors of success for all digital transformation processes in any retail sector, in which the New Normal means an omni-channel approach above all else and more than ever.