5 Digital Transformation Steps for Retailers in 2021

Retailers were on the path to digitally transform their operations prior to the Covid-19 pandemic. But the health crisis — and with it, radically altered consumer behaviors — has accelerated those plans. Many retailers are attempting to accomplish in months the digital transformation initiatives that they had previously planned to accomplish in years. As we enter 2021, brands are rushing to make the necessary changes to processes and technology to position themselves for success in a digital-first landscape. 

Retailers know they need to do things differently, but how do they prioritize their digital transformation investments? Below are five pragmatic, digitally driven pivots retailers should focus on now. 

First steps

To build an agile, digital-first business, retailers should start by dissecting online and offline processes. Consider what it is like for customers who want to “pre-shop” a store before they visit.

Do inventory stock levels show up correctly online? Does the business support key in-store processes such as ship from store, pickup in store, and curbside pickup? These flexible fulfillment options can make or break a sale for online shoppers. Additionally, retailers without delivery services already in place should consider partnering with third-party home delivery providers. It is crucial to be as accessible as possible.

Assess each location

Review your portfolio of physical stores, and define the right role for each location. Although some stores may need to be closed due to low foot traffic or sales, other stores can be used as fulfillment locations.

For example, some locations could be converted to dark stores or gray stores — where their only purpose is to hold or fulfill local orders or to offer a small selling space backed by a much larger fulfillment space. Another possibility is to use a storefront as a curbside pickup location for customers who don’t want to queue or enter the store.  

Rebalance inventory

Rebalance planned inventory in stores to align with their defined roles. It is important to consider how Covid-19 buying habits are impacting inventory needs.

If a store is engaging in both fulfillment and in-store selling activities, retailers could pull items that do high volume through fulfillment off the sales floor and restock with items that need a sales boost from in-store shoppers. This should be revisited often, especially as consumer behavior shifts. 

Experiences

Entice customers with new experiences by disrupting processes (where it makes sense). For instance, consider how in-store associates or fulfillment experts can engage customers with upsell or cross-sell opportunities as they collect an in-store pickup order.

Another strategy is to offer impulse items near the curbside pickup tent. At a time when many consumers are opting to spend less time in stores, these customer experience enhancements can boost shopper satisfaction, safety, and convenience — while driving increased sales. 

Mobile first

Think mobile first to support the holistic customer journey. Explore how mobile can be used to enhance the customer experience — like sending delivery updates or pickup instructions via SMS. Smartphones can also be used to deliver a safer, touchless in-store experience. One example would be a mobile app that allows customers to pick up an item in the store and scan it with their phone in order to make their purchase without needing to queue or deal directly with staff. 

A long-term competitive advantage 

Retailers need to prioritize digital transformation in order to successfully navigate this environment. They should focus on a digital-first approach that includes omnichannel acceleration, inventory transparency, and an emphasis on customer communication. The goal should be to provide the best, most competitive shopping experience, with the ability to fulfill from physical storefronts and to provide timely updates to customers regarding the shipping/fulfillment process. 

It’s not enough for a brand to survive disruption. You want to be able to thrive in it. These five purpose-driven pivots should serve as a roadmap to help retailers make the most of their physical and digital resources and address new consumer buying behaviors. Digital transformation isn’t a short-term solution; it’s a long-term competitive advantage. 

Nikki Baird is the vice president of Retail Innovation at Aptos.

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