Jan 12 2023

NRF 2023: How Retailers Can Win Over Customers as They Return to Stores

By managing their inventory, improving store productivity and reducing friction at the point of sale, brands will highlight the delights of in-store shopping.

Consumers are returning in droves to America’s retail stores. That’s good news for traditional brick-and-mortar brands, which make more money from in-store transactions than from online shopping. But how ready are they to welcome customers back?

Many retailers are concerned that post-pandemic consumers, accustomed to the point-and-click simplicity of online shopping, won’t be patient with clunky in-store experiences. Improving that experience will be a key topic of conversation as the nation’s retailers gather next week in New York City for NRF 2023: Retail’s Big Show.

Andy Szanger, CDW’s director of strategic industries, says building delightful experiences for customers requires retailers to focus on three key pillars: inventory management, store productivity and reducing friction at the point of sale.

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Retailers, Do You Know Where Your Inventory Is?

Supply chain issues have affected every industry, but none more than retail. When you’re in the business of selling goods directly to consumers, it’s vital to have deep, real-time, accurate knowledge of your inventory.

“When you’re seeing supply chain issues, it’s more important than ever to understand what inventory you have, where you have it, where your customers are, and where you need to have that inventory to make sure you have the right inventory in the right place at the right time,” Szanger says.

Inventory management is more complex in a digitally transformed retail environment. In buy online, pickup in-store scenarios for example, it’s vital that retailers have an accurate inventory and know where each item is in the store; otherwise, it will fail on the “pickup” portion of a BOPIS transaction, frustrating consumers who’ve spent money on an item they can’t claim.

This happens when store personnel can’t find an item, either because its inventory count is inaccurate or it has been misplaced.

“BOPIS adds a level of complexity, but it’s really about the understanding of my inventory,” Szanger says. “Because I have less of it, I need to be more efficient with it.”

One solution is the use of radio-frequency identification (RFID) tags combined with handheld scanners, which help employees easily determine what inventory is where. RFID tags are not new, but the technology has been updated so they are more cost-effective for use at scale.

“You can use more integrated, high-level scanners at the store level to understand mapping of your store, but as you get more granular, you can actually use a handheld scanner to see exactly what’s where,” Szanger says. “It allows them to scan shelves and see exactly what’s there without having to manually look through all the racks. It can also have higher-level mapping with geolocations of where the items are located based on the tags.”

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Retailers, Do You Know How Productive Your Stores Are?

Store productivity is more important than ever because of labor shortages. Widespread remote work has opened opportunities for people to work in industries that previously weren’t available to them — people who used to work in retail stores, Szanger says. That’s caused a serious shortage of retail workers, which in turn forces retailers to be more effective in getting productivity out of each worker they retain.

“The dynamics of the workforce have shifted, and there are fewer people available who want to work in retail,” Szanger says. “It becomes a question of how retailers can maintain the customer service that people expect with fewer employees.”

In short, retailers must maximize staff efficiency, scheduling them at the right hours and deploying them in ways that increase their customer engagement time.

Modern security cameras equipped with artificial intelligence allow retailers to access the kind of insights for their physical stores that they could previously only access for e-commerce.

“You now have a visual map of what’s happening in the store. You can see the entire customer journey,” Szanger says. “You can see where the customer goes, how they moved around the store, with whom they interacted and whether they made a purchase.”

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Enhanced video surveillance (EVS) cameras can alert store personnel when a customer appears to be struggling with a purchasing decision so a staff member can be sent to help. If someone doesn’t make a purchase, store managers can get insight on why not. “Now I can see that the customer stood there for five minutes, then walked out,” Szanger says.

Heat maps have been used for years by retailers to gain insight into how people move throughout their stores, but EVS delivers more. “It’s not just a heat map; it’s insight,” Szanger says. “If I see I lost a sale while I have five employees sitting in the back room not helping, that tells me I have a training issue.”

Beyond insight on individual customer journeys, modern EVS systems make it easy for retail chains to aggregate data across periods of time and among store locations. They can see which stores get the most traffic when, which have the highest and lowest conversion rates (the percentage of shoppers who make a purchase) and more.

“Ultimately, it puts insight into the hands of store leaders, on which they can base decisions,” he says. “Those decisions could be about the placement of store inventory, or about what people I have on staff and when, or it could be about where I position those staff at different times of day.”

Of course, these enhanced security cameras also provide advanced security; for example, alerting staff to a person acting suspiciously based on patterns of behavior common to shoplifters.

Andy Szanger headshot
Retailers want customers to come back to the store and to spend more time in the store to create better brand loyalty and customer engagement.”

Andy Szanger Director of Strategic Industries, CDW

Retailers Opt for a Seamless Customer Transaction Experience

The shift to online shopping precipitated by the pandemic has trained consumers to think that shopping should be easy. As they’ve returned to stores, they’re rediscovering the old frustrations that come with standing in line and dealing with crowds — but now they’re less patient.

“Coming back to the store, especially in light of labor shortages, it wasn’t that seamless of an experience,” Szanger notes. “Retailers want customers to come back to the store and to spend more time in the store to create better brand loyalty and customer engagement.”

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That’s why it’s vital that the retailer’s final touchpoint with a customer — the transaction — is as simple, smooth and quick as possible.

Retailers are deploying modern checkout technology to power that kind of experience, including contactless payment, self-checkout and mobile point-of-sale solutions that allow store associates to check customers out right where they’re standing rather than requiring them to wait in a checkout line. Solutions enabling a modern checkout include modern point-of-sale kiosks, updated payment terminals and mobile devices from providers such as Apple, Elo and Zebra.

“It’s about finding ways to reduce friction and improve the checkout process” he says. “Customers should enjoy the time they spend in a store, but when they decide it’s time to conduct a transaction, the store needs to make it as simple and efficient as possible, so the customer leaves the store feeling good about the entire experience.”

Keep this page bookmarked for articles from the event, and follow us on Twitter at @BizTechMagazine and the official conference Twitter feed, @NRFnews.

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