Five Key Focuses for Peak Season
Back-to-school/college and holiday shopping are retailers’ busiest times, but the type of “busy” varies year to year. That’s because customer wants and needs evolve based on many factors, from economic issues to the newest and hottest products and trends to retail technological advancements.
While every high-traffic date on the calendar demands strategic planning for inventory management, discount strategies and associate training, here are five areas that are worthy of special focus as we turn toward peak season and 2024.
These are complicated times
While COVID-19 is in most folks’ rear-view mirror, many of your customers continue to be on edge for a variety of reasons, from inflation and economic uncertainty to polarized politics. For one, despite inflation slowing down, 80% of shoppers are expecting to face higher prices this peak season.
But how is 2023 different than 2022?
Edelman’s 2022 “Trust Barometer” was titled, “Societal leadership is now a core function of business.” It found that 58 percent of respondents “will buy or advocate for brands based on their beliefs and values,” while 80 percent “will invest based on their beliefs and values.”
And in 2023? Edelman’s title is “Navigating a Polarized World.” It notes “Only 40% of respondents say they and their families will be better off in five years, a 10-point decline from 2022.” And adds, “While people want business to do more on social issues, it risks being politicized when engaging on contentious issues.”
While the survey points out that “Business is the only institution seen as competent and ethical,” we also know that, unfortunately, the culture wars are now being fought in retail — in stores, in the news media and on social media.
While Miller Zell fully and actively supports sustainability, philanthropy and social responsibility, we also understand that retailers are under pressure from customers — and associates — with widely divergent worldviews.
Therefore, consider your chief customer experience during peak season to be about relieving stress at every touchpoint for all customers. Surprise and delight with perks, discounts and specials that tell all your customers that they are important to you. Train and empower associates to deescalate, guide, serve and reward customers so they walk out of your store perhaps feeling better than when they walked in.
Gen Z rising, Gen Alpha arriving
Gen Z is growing up and beginning to earn its own money. It also epitomizes the omnichannel generation. They like to shop online. And they like to shop in stores. Social media plays a huge role in their lives and shopping habits (85% said social media influences their purchasing decisions).
They are going back to school and back to college and, as a cost-aware cohort, they are already thinking about what they will get and give during the holiday season. They will play a significant role in directing the spending of their Gen X and Millennial parents.
And let’s now welcome Gen Alpha to your store strategy. This will be the first generation growing up with fully digital-savvy parents, who aren’t as screen-phobic as previous parents. Fifty-four percent of Gen Alpha kids already own a tablet, roughly the same rate as older children, and 25% live in a home with a VR headset.
The subtly evolving shopping habits for these generations are the present and future of retail.
With that in mind, analyze and optimize all your customer touchpoints, including social media. An exclusive offer on TikTok? Your app offering coupons for past peak season purchases, as well as custom suggestions based on a child advancing from 8 to 9 or 17 to 18? These improve your customer experience by meeting customer needs and expectations and reducing friction, whether they are buying in your store or on their sofa. And they provide valuable data.
AI now and in the future
What’s become clear about retail technology over the past decade is that it’s rarely an easy, direct path to perfect adoption. That said, “What’s next” — the internet, digital screens, apps, AR & VR and AI — eventually does step into the practical spotlight and produces results in the present.
AI is already doing that for many retailers, and its potential for serving customers and increasing operational efficiency is immense. AI spending in retail is expected to grow from $7.14 billion in 2023 to $55.53 billion by 2030. It will support critical tasks, from supply chain management to personalized customer service to optimized pricing to targeted advertising to product recommendations. It can even support sustainability efforts and security and loss prevention.
Further, it will provide a continuous feedback loop for mission-critical functions, which means it can provide important support and data this peak season for your next peak season. And the one after that, etc.
Of course, its immense potential means there’s also a wide range of ways to flub adoption and not create ROI from investments. Further, as noted in a recent Chain Store Age story, “83% of respondents say they will only benefit from AI if they modernize legacy apps and data.”
While there’s some concern that AI will eliminate jobs and then potentially damage retailers’ public perception, it’s as likely that AI will create new and potentially better jobs. While AI takes over inventory tracking, data collection and checkout, “it also can free cashiers to focus on more complex and personal tasks requiring human interaction,” the Wall Street Journal noted.
Speaking of checkout…
A long checkout experience can ruin everything. As in: 77 percent of shoppers are less likely to return to your store if they feel they spent too much time waiting in the checkout line.
Many customers still seek out standard checkout with an associate at a cash register. Serving them includes using data to identify peak hours that require more staffing, as well as ensuring that staff is fully trained to perform as efficiently as possible. But it’s now necessary to offer a variety of checkout paths that improve the efficiency of the process and thereby enhance the customer experience.
This includes BOPIS and self-checkout, as well as mobile POS systems that allow associates to check out customers throughout the store, accepting mobile payment methods, such as Apple or Google Pay or PayPal, and even technology supporting no-contact checkout that allows customers to simply grab and go.
Just adopting new technology isn’t the endgame, though. It’s critical to provide adequate training and quality control and to anticipate potential execution hiccups. Efficient and pleasant responses to problems often positively register with customers as much as a frictionless store visit.
The dual edge of fighting shrinkage
Many retailers have taken strong measures to decrease retail theft. And these often work. But these measures also can annoy customers, who grumble when they find products behind lock & key, thereby increasing wait time and decreasing purchases.
A number of stores, including Kroger, Lowe’s and Safeway, have introduced technology that lets shoppers provide their cell phone numbers to receive a code to unlock merchandise on shelves. But many customers don’t want to do that.
And, of course, peak season means increased crowds, shoppers on edge and security perhaps even more difficult to maintain.
There are a variety of measures that are less invasive that retailers can take to reduce shoplifting, including store layout tweaks that can help control traffic. Those associates no longer at cash registers up front? They can serve as smiling “greeters” and guides while also doubling as unthreatening deterrents to theft.
There also are new anti-theft fixtures, which recently comprised two entire exhibit halls at Euroshop in Germany earlier this year.
There’s shelving that only shows one row of product at a time, which deters organized “shelf clearing” theft. Another fixture allows shoppers to inspect high-end merchandise like watches or shoes, but when they reach in to touch the item, a light turns on and music plays. Unknowing shoppers see this as an enhanced shopping experience, but it also alerts employees/security nearby that the high-end merchandise is being handled.
Finally, theft training for associates, which is always important, should be reemphasized for associates in advance of peak season, with an emphasis on safety for associates and customers and clear protocols for handling such situations.
In the end, every measure you take during peak season is about taking care of your customers’ wants and needs, thereby creating brand advocates who will look for reasons to shop at your stores during every season of the year.