Where Retailers Should Focus Right Now
Where Retailers Should Focus Right Now
A good portion of my time is spent in conversation with business leaders discussing the challenges their businesses are currently facing. It should come as no surprise to hear that top-of-mind right now is finding a way to navigate these economically uncertain times. What they seem to be struggling with the most is striking the right balance between where to scale back and where to invest.
Where to Pull Back
Pursuing Projects That Will Take Years to Yield ROI - One of the many things working against you during an economic downturn is time. You simply don’t have enough of it to invest in projects that will take years to show any measure of a return on investment, such as blockchain or new ERP implementations. What you need now are quick wins. This should include efforts like A/B testing and conversion rate optimization, where you can identify small areas to optimize and improve conversions
Excessive Inventory - COVID-19 put a tremendous strain on supply chains. Over the past several months though, that strain has eased and more products are finding their way to retailers’ shelves. Unfortunately, due to inflation, consumers are being more selective with their purchases, leaving companies sitting on stockpiles of products that they no longer need to have on hand “just in case.” I suggest using your data to understand historical and seasonal buying trends and plan to have just enough on hand.
Hiring Full-Time Resources - One of the first things you should ease up on is hiring full-time talent. Between compensation, health insurance, and recruiting costs, bringing on new staff is an expensive proposition. If you must bring people in to manage your current projects, you should consider fractional hiring, which will allow you to bring on the experienced talent you need but at a much more affordable cost.
Where to Accelerate Investment
While you’ll need to pull back on some things, here are the areas that you should focus your time and effort:
Efficiency Projects - While it’s never a bad time to invest in projects that empower your customers and make their buying experience easier, today that’s more important than ever. Developing mobile apps, self check-outs, improved check-out flows, and better payment processor technologies not only gives your customers a sense of control over their user experience but helps them complete the purchasing process with greater ease.
Emotional Connection - While inflation is forcing consumers to be more deliberate with what they buy, there are certain things you can do to make purchasing from you more likely. Enable customers to purchase through emotional connection, oftentimes starting through social media. Consumers will discover your product or service through Instagram or TikTok and let their emotions guide their purchase behavior. You can also provide direct access to customer service reps via text or chat functionality. The idea is to remove any additional barriers that could get between the consumer and making a purchase, and leverage the power of emotion.
Data Infrastructure - Getting your data infrastructure to a point where it’s consistently reliable and trusted can provide you with an invaluable, comprehensive picture of how your customer behaves online, in-store, and on mobile. The insights that you will gain by looking into and leaning on your data will allow you to easily test which, in turn, will help you make more informed business decisions and improve your customer’s user experience.
On-Site Testing - A/B testing and conversion rate optimization are always critical to eCommerce success, but this year even more so. Test the elements that pose the biggest barriers to purchase throughout the consumer journey, such as shopping cart design, promotions, and payment options. With consumers taking a more cautious approach to spending, promotional messages may play a more prominent role than it has in the past. Aggressively test different kinds of offers—everything from buy one, get one (BOGO), to a percentage off versus a specific dollar amount off.
“At its core, that’s what digital transformation is about:
the ability for a business to swiftly adapt to shifts in the marketplace, consumer behavior, and technology itself. ”
MANISH B. HIRAPARA
Opportunity Knocks. Seriously.
A challenging economic climate certainly poses problems for businesses across all industries—but they also offer opportunities. While you might be forced to cut back in certain areas and put key projects and initiatives on hold, there are still actions you can take that will not only positively impact your business but provide your customers with a more efficient and memorable user experience.
Whether it’s business advice, strategies, or providing executional assistance, PeakActivity is the eCommerce consultancy with the expertise and resources to help you navigate these tumultuous economic times. Contact us to learn how we can help you.
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