Preparing for the future of Retail & Hospitality
Hello and welcome to our latest installment of important trends shaping the future of retail, hospitality, and consumer goods. As the 2021 holiday season quickly approaches, retail businesses are ramping up their workforce in preparation. It is also a vital time to shape the budgeting and investments for the upcoming 2022 fiscal year. The past two years have caused catastrophic upheaval in retail and the hospitality industry.
Businesses that have been able to survive are now asking the question of how they can stay relevant. Leaders of SMBs have also been struggling to hire the essential personnel to keep up with customer demand amid the slow resurgence of the economy. Strategic leaders are beginning to understand the importance of technology. Prepandemic businesses could succeed with the status quo, picture an analog cash register. Although, the future of industry has arrived with McKinsey’s landmark study on customer’s buying patterns during the pandemic.
Technology not only supports customer journeys such as BOPIS, curbside pickup, and mobile ordering, but also has an unexpected result that is rarely discussed, happier employees. The talent wars are real. We hear stories in the news almost daily about business owners who are seemingly unable to find anyone to operate their business. This is not surprising in the least. I recently wrote a blog that LinkedIn’s editorial team selected on the topic of COVID19’s financial strain (see here).
It may sound cliche, but behind any successful company is the employees who built it. Therefore, employers need to place emphasis on the employee experience. This means putting them in a position where they are doing meaningful work and able to grow professionally. First, the culture of success starts with training them during their onboarding and regularly afterward. Another essential step is identifying low-value work that they hate doing. When employees feel like they are growing and making an impact, they are much less likely to leave the organization.
One of the most significant aspects of employee frustration is chaos. Chaos manifests itself in several different forms, whether it be confusion, lack of clarity on who’s doing what, when, or a lack of systems to create a pleasant working environment where the staff enjoys each other vs. fights each other. In 2022, business owners will need to implement the systems and processes to operate like a well-oiled machine.
Top 3 Opportunities for 2022
- Omnichannel – Doing more with less
- Marketing personalization/Customer loyalty program
It is no mystery that Independence Bridge Consulting is big on omnichannel. There are so many reasons businesses need to rethink their strategy if they haven’t adopted omnichannel. In business, you always hear terms like “streamlining”, “cost-cutting”, and “maximizing profits”, but usually, there’s very little context to properly frame these concepts, and these statements just confuse people. Omnichannel is a broad term, but can be applied to multiple facets of business whether it is related to placing an order through various channels such as:
It is also applicable to communication that reaches the customer through different channels:
- Social Media
There are so many use cases, but from my experience, it mostly boils down to consolidating legacy systems towards a single source of truth to manage inventory better and produce timely financial information. It is no longer the early 2000s; there is no reason why any business has disparate data sources that stay siloed, thus not delivering value to the company.
With a properly set up omnichannel platform, you will be able to streamline operations by eliminating systems that break. Cost-cutting also becomes a platform because you can eliminate software that serves a limited range of use cases. Last and most important, the organization will be able to maximize profits through the use of robust analytics and real-time data. This will provide the opportunity to understand products that sell and peak times when the business generates the most revenue. Lightspeed POS is the defacto at achieving the use cases above with its powerful suite and API capabilities.
Marketing personalization/Customer loyalty program
In today’s modern marketplace, customers expect relevant marketing and offers. Yet, so few businesses have this capability. The concept is remarkably connected with personalized marketing because if you aren’t able to keep track of what the customer is purchasing, there’s no possibility of sending personalized marketing. Although, a customer loyalty program is a little different because it is based on the idea that customers who frequent the establishment should be rewarded with cashback and special discounts.
In order to accomplish both, businesses will need to invest in their technology infrastructure and build integration between POS and their CRM system. For all intents and purposes, the customer will most likely be interacting with the POS whether it be at the retail store or eCommerce store. Under the hood, it is the CRM that is managing thousands, millions, or billions (think of the Amazon, Sam club’s of the world) of customer records. This is done using primary identities such as email address or phone number. Think about it, when you go to CVS, they always ask you if you would like to enter your loyalty code which is your phone number.
The front end that customers see is generally just a conduit for the CRM. The CRM goes much further to track interactions such as (email opened, offers clicked, discounts redeemed) and store customer purchase information in a relational data format. If the data isn’t stored in a relational format, then data science (aka personalized marketing ) is just a futuristic concept.
Search engine optimization (SEO) and search engine management (SEM) have never been more critical post-pandemic. Amy Eschliman, Google’s Managing Director, Retail, Cloud Industry Solutions, mentioned during a recent NRF webinar that google’s ‘near me’ feature has an almost 60% increase which is very encouraging. This signals that shoppers are looking to shop at businesses that are close to them, whether it be for a slice of pizza or toys for their kids.
Search engine optimization is a concept of customers being able to find your business. This is related to having a website that loads fast and is crawlable by the google robot. In addition, Google’s proprietary search looks at the quality of the website’s content. It is crucial that your business has social media profiles and backlinks on other sites pointing to your website.
Search engine marketing (SEM) is a process of setting up digital advertising optimized for google, bing, and other search engines. While SEO is driven mainly by organic traffic, SEM combines paid advertising and organic traffic. Whether we want to admit it, everyone is using google. They’ve become a behemoth because of their marketing. Their other products came later. SEM is largely based on keywords with various ranges of competitiveness. The more competitive a keyword is, the more the PPC (pay per click) will be.
Search is here to stay for the foreseeable future. Those in the retail business should know; if potential customers are not able to find your business, you are losing business, especially in today’s marketplace. The SEM process takes constant a/b testing, experimenting, and iteration. A lot of folks give up, but if you are running a retail, hospitality, or consumer goods business, you need to stay patient and think of this as a process rather than a means to an end.
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