COVID-19 Accelerates Need for Innovation

Businesses need to respond to present stress, pivot to future

By Miller Zell

Before the COVID-19 pandemic disrupted people’s lives and the international economy, every retailer knew it needed to consistently innovate in order to stay ahead of its competition. The question was how to do it purposefully so that it both improved the customer experience and provided ROI.

COVID-19 didn’t change that. In fact, in many ways it created more urgency. Retailers immediately needed to adapt to survive. And they will need to evolve as we move forward, however uncertain that path is.

High-stress times in business often breed innovation, and that’s what Miller Zell is seeing. From in-store digital, to supply chain, to merchandising, to queue management, to checkout, many retailers are being pushed from their previous mode of tentative experimentation into an urgent adoption. COVID-19 has become a catalyst for change, accelerating the need for many initiatives that improve the efficiency of the customer experience.

The pandemic provoked a new retail anthropology that is in varying degrees immediate, short term and, yes, permanent.

All of this creates a different customer journey than before. That means retailers, as they react, must update their data collection and analytics for the post-COVID-19 shopper. Customer expectations and behaviors have changed, and retailers need to discover new friction points and develop new solutions.

As for innovation emerging from a new normal, consider QR codes. They’ve been around for a while, allowing consumers to quickly load third-party media and information into their cell phones. But in the contactless time of COVID-19, their value increases. For example, restaurants can replace menus with QR codes at the table, so each customer can read the day’s offerings and specials on their cell phones without needing a menu touched by other customers or waitstaff.

As a potential long-term solution, eliminating menus saves the restaurant time and money, as staff no longer needs to waste time scrubbing or replacing old menus. Further, daily or weekly changes are now just a matter of a few keystrokes, no printing required.

Then there’s an opportunity for more advanced data collection. If a dish requires a tap to reveal more information, the restaurant knows what gets reviewed — and then ordered or not — and what receives the least amount of interest.

A QR code at a home improvement store can reveal what is required to complete a project, while one at an apparel store can offer additional options — sizes, colors, accessories, etc. — that are available for delivery if they aren’t on the shelf.

Such in-store adoptions mean less contact and more convenience for customers and associates --  and perhaps a larger basket size.

The same can be said for developing and refining in-store app use and BOPIS, which grew 195 percent in May compared to a year ago, according to a survey from Adobe. Some shoppers previously resisted BOPIS before the pandemic simply because it was a different experience, but now many who were pushed into giving it a try during the shutdown discovered its ease and convenience.

“Why didn’t I do this my whole entire life?” 64-year-old Mary Alft rhetorically asked the Wall Street Journal about her discovery of BOPIS.

Another technology that faced resistance before COVID-19 is AR/VR interfaces for beauty products. Customers preferred to test cosmetics, creams and fragrances on themselves before buying and often didn’t trust the augmented or virtual images.

That might be changing, as both Ulta and Sephora are pushing and improving their virtual makeup try-on apps, where a customer can take a selfie or even use a live shot to digitally try on makeup, such as lipstick or eyeshadow. An Ulta representative told CNN its “GLAMLab usage has increased by five times in the pandemic.”

As for Sephora, its opening a digital storefront on Instagram checkout that allows shoppers to buy directly from a user’s Instagram feed feels like an inspired move toward social commerce, particularly when meshed with the try-on app.

Meanwhile, IKEA’s Place app lets customers virtually place furniture into their homes, providing a purchase preview of their potential new sofa while sitting on their old one.

Let’s not forget robots. While that might call to mind all sorts of science fiction scenarios, the truth is robots offer a great alternative for cleaning and inventory management that reduces contact points and improves efficiency. Walmart has taken a lead here with contracts with Bossa Nova Robotics for inventory and Brain Corp’s robots for cleaning.

Finally, retailers need to anticipate the coming of 5G. Five years from now, 65 percent of the global population will be covered by 5G, according to a report from Ericsson. This will create faster connections and greatly reduce the dreaded latency that turns customers off when they try to use retailers’ digital offerings and IoT devices.

5G will clear the way for more widespread adoption of smart shelves, digital price tags and real-time, customized, in-store messaging for a personalized shopping experience.

And, on a more mundane level, retailers also should look into antimicrobial shopping cart handles. It’s fair to anticipate folks are going to be more germ-aware going forward, even post-vaccine.

Innovation can be both big and small.

Details matter.

Much of what is noted here is not new or revolutionary. What’s changed are the rules of public environments and shared spaces and customer expectations and behaviors.

In other words, amid the stress and complicated dynamics of retail’s present situation, there are also plenty of opportunities to innovate and meet and exceed customer expectations now and into the future.

 

Editor's note: This story was published in July of 2020.

 

 

 

TAGS Thought Leadership Environment Merchandising Fast Casual QSR Restaurant Retail Analytics Digital Customer Experience Retail Strategy Retail Design COVID-19

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