@mela_ik

Showcase stores are replacing classic retail spaces

2021-10-20T10:12:06.590Z

Against the background of growth of online sales (up to 60-70% in some categories of stores), a number of retail segments are expected to undergo significant transformation of retail space functions over the next few years.

The trend of replacing classic stores by "store-windows" is fixed in shopping and entertainment centers with GLA from 30 000 sq.m. and malls. This was reported by experts of Lasmart (the developer of IT-systems of retail space management). This trend will develop, and in the coming years some categories of stores will almost completely move into a "showroom with ordering platform + checkout" format, while maintaining a minimum range of products, which is designed for offline sales.

Lasmart experts believe that in the next two years, a number of tenant categories in shopping centers, malls and hypermarkets, the share of physical purchase will be about 10-15% of total volume. At the same time experts don't expect the reduction of customer traffic, because they believe that the usual middle-class stores in malls and hypermarkets will remain attractive, but only as a showcase, a place for decision-making and order delivery points, and the main traffic generators of shopping centers will be global verified brands, expanded segment of catering and entertainment.

"Considering this trend, I would not equate the already classic online sales and the type of shopping, the development of which we expect in the next three to four years, - says development director of Lasmart, the developer of IT-system management of retail space. Here we are dealing with a new market reality, where we are dealing with the fact that stores are increasingly becoming a showcase, a place to make a purchasing decision and receive an order, rather than a place where an actual purchase is made. In some segments of retail, a significant portion of product categories is already presented only as samples, and the share of such categories will grow, as will the number of operators who will implement this scheme. It is possible that the usual cash registers will be reduced to a minimum. Choice of goods and payment will be made through tablets placed in the store or by scanning a QR-code on the price tags. The customer will fill their virtual shopping cart, pay for the purchase and receive the goods either immediately or later, with delivery."

To date, the flagship of the retail transformation toward a new sales concept, according to Lasmart, is the DIY segment. According to experts, about 60% of purchases are made online, including online purchases with the physical presence of the buyer in the store. In some product categories of this sector (e.g., electrical appliances), almost 80% of the assortment is present on the shelves as single samples, not for sale.

Among the segments most focused on changing the functionality of retail space in the near future, experts name sanitary ware, furniture, fittings, design, decorative cosmetics and perfumes. Transformation of the retail space has so far been delayed in time for fashion operators; experts believe this is due to the need to finalize software solutions that allow vitrualization of the fitting process with a high degree of accuracy.

Exhibition samples, vitruizing fitting clothes and shoes, and other new technological customer options already cope with this task well enough, and as soon as it will be solved on a consumer scale, the transformation of retail space and merchandising concepts will begin here as well.

Lasmart specialists believe that the proportions of leasable retail space will undergo changes in the direction of reducing the auxiliary storage space due to the abolition of the need to store large inventory and increase the size of the sales area for extended exposure and a comfortable waiting area for goods.

This does not mean, however, that by reducing inventory, the store should reduce its product representation; shelf abundance is one of the key factors of attractiveness. In addition, a certain amount of in-demand assortment will still be sold offline. And in this case, the most successful sales will be with the tenant who will be able to properly analyze the data on sales and margins of goods sold, and as a consequence, configure his merchandising in such a way that, separately emphasizing the items sold offline, effectively exhibit product samples.

Chatbots will save retailers $439 million annually

2021-09-13T11:31:12.616Z

Just AI has presented an overview of conversational AI in retail. The research includes Russian and Western analytics, trends, cases, and the opinions of retailers and vendors.

According to Juniper Research, by 2023 chatbots will save retailers $439 million annually compared to $7 million in 2019. Retail sales through this channel show an annual growth rate of 98% and will reach $112 billion in 2023 versus $7.3 billion in 2019.

"We are now seeing an increase in interest and demand from retailers to automate customer communication channels. The year 2020 has highlighted all the weakest aspects of communication with customers in retail, and because of this, companies have to restructure their business processes. Automation starts with MVPs, and rightly so, as this industry has many internal systems to integrate with, which requires resources from all project participants," comments Sintia Zakarot, Head of Customer and Partner Relationships at Just AI.

Another element of the digitalization that is gaining momentum is mobile applications. App downloads increased by 11% from January to April 2020 compared to the same period last year. And more than 45% of U.S. users would like to be able to interact with mobile apps by voice.

The habit of voice control has largely been shaped by smart speakers and screens. At the end of last year there were 400 million such devices in the world. 62% of smart speaker owners in the U.S. have ever made a purchase using their voice. Voice commerce sales in the U.S. market are expected to reach $40 billion by 2022.

"Our goal is not to build a wall in the form of a chatbot or smart IVR between the customer and the company, but to solve the issue as quickly and efficiently as possible. The voice or text assistant should eventually become a purely utilitarian problem-solving tool - fast, convenient and efficient," says Konrad Rudenok, technology development manager at M.Video.

"The prospects of conversational AI in retail, as well as in many other areas, are very high, since AI answers much faster than a live person, and customers quite often ask questions that can be fully answered with one template. Of course, an operator is also needed, as highly specialized queries occur. In my opinion, AI is rather the first echelon of customer assistance, which helps reduce the load on operators by freeing them from answering typical questions," comments Pavel Gurshal, IT product manager of "Site" at DNS.

Almost 90% of clothing and footwear manufacturers will invest in digital product development

2021-08-19T13:33:32.350Z

Digital product creation is higher on the list of investments from 2020 among retailers, footwear and apparel manufacturers. But how far has this trend been able to advance in terms of full-scale adoption and the business results that can be achieved with 3D and digital solutions?

Since 2016, Kalypso, which is part of Rockwell Automation, has been working with industry research groups and educational institutions to survey organizations from the retail and footwear and apparel industries about trends in digital solutions. The latest survey results include insights from more than 40 brands and retailers.

Survey participants rated their organization's current and future level of development in these areas on a scale of 1 to 5, where 1 is no steps taken, 2 is a strategy developed/ has a plan, 3 is a hypothesis testing method developed/ has a pilot, 4 is implementation beyond simple hypothesis testing and pilots, and 5 is full implementation including a learning process for all parties involved. Below we present 5 key findings of the study.

Finding #1: Companies are "stuck" in the proof-of-concept phase

While 2020 data shows a moderate increase in the current level of digital solution development, few companies are successfully scaling beyond the hypothesis testing stage.

Solutions such as 3D product design and integration of customer voice analytics had the highest adoption rates (2.43 out of 5), but the prevalence of projects such as virtual showroom/store planning and virtual assortment review/line planning received an average score of 1.8 on the scale.

Finding #2: Lack of technical and operational fundamentals slows down scaling

The industry does not yet fully understand how to turn instant wins into long-term transformations, and in most cases it lacks the technical and operational foundations needed to scale.

Finding #3: Companies have big plans and expectations for digitalization

The survey data reveals big plans and expectations for brands and retailers in relation to the future level of digitalization in their companies.

Here are the survey results, which tell us where companies will be investing in the next two years:

- 85% in digital product development;
- 78% - in 3D product design;
- 78% - in virtual usability testing;
- 71% in visual line planning.

Conclusion #4: COVID-19 has triggered an accelerated development of digitalization, but companies lack a clear and coherent strategy

Almost all companies surveyed believe that the pandemic has accelerated the need for digitalization in design, development and merchandising.

- 93% believe that the COVID-19 pandemic has accelerated the need for digitalization in
- Only 59% believe they have a clearly defined strategy for future digitalization.

Conclusion #5: Barriers to success are about people, NOT technology

It's a misconception that the main barriers to digital transformation for companies are process and technology. In past surveys, respondents answered that their main barriers to digitalization were related to motivation, 2020 data tells us that 44% do not have the necessary skilled digital talent, such as 3D designers.

As digital product development in apparel has the potential to be the most significant career change for many people, there are now many questions about the impact on training, roles and responsibilities within end-to-end product development teams.

Breaking it down: Five mistakes when writing motivational programmes for merchandisers

2021-07-14T11:26:40.882Z

Merchandisers are one of the most challenging positions in retail, with one of the highest turnover rates and one of the lowest remuneration levels.

First and foremost, we would like to point out that manufacturing companies are not always aware that merchandisers, sales representatives and consultants, while overlapping in function, are completely different positions that are chosen by people with different drivers and values.

ANCOR's summer 2020 Merchandiser Portrait Study found that the lion's share of merchandisers are not interested in career advancement, but rather in having a stable, full-time job close to home and receiving predictable remuneration.

We see sales representatives and product consultants, on the other hand, as being interested in development and career progression. So when creating a motivational programme for merchandisers, it's important to consider the specifics of the target audience.

Stability

One of the most common reasons for merchandisers to quit is the instability and unpredictability of the payout. The average income of merchandisers in Moscow is about 35-40 thousand roubles, in the regions it is 25-30 thousand. More than 80% of specialists are merchandisers aged 25 to 45 years, that is the part of the population that already has families and actively uses mortgages and consumer credit. Therefore, the instability of payments for employees poses risks to both family well-being and the solvency of loans.

Even minimal wage delays will prompt the employee to look for a new job. And he will find it quickly, because offers are plentiful on the market, and merchandiser loyalty to the employer is usually quite low if the latter is not eager to meet the needs of this category of employees.

Experience has shown that stability and fairness in payment help to almost halve the turnover for this position.

Transparency

Merchandisers' compensation figures and formulas are often so complex that even people with degrees in economics and mathematics cannot always make sense of them. In practice, this means that merchandisers do not even try to understand such calculations, and take a philosophical attitude towards remuneration: they manage to earn more - fine, but they fail - I do not understand why, so be it". Clearly, this attitude is not conducive to creating additional motivation.

The solution is to link remuneration to specific results of merchandiser's work and to a clear bonus scheme with an easy calculation. That is, the employee should clearly understand for what deficiencies the remuneration may be reduced, and what may contribute to its growth. It is very good if this information is easily accessible online, such as in SFA-system (Sales Force Automation) or in e-learning platform, showing the progress in achieving the goals during the month and, therefore, the likelihood of obtaining a reward. And, of course, such information should be updated promptly if there are any changes in the company related to the merchandiser's tasks and focus.

When calculating KPIs for merchandisers, it should be borne in mind that it is not always up to the merchandisers to ensure that the products on the shelf are presented. And if the logistics service, for example, does not deliver the goods on time, this has to be taken into account: the merchandiser's remuneration should not be reduced because of deficiencies in the services over which he has no influence.

Real KPIs

A typical situation in the life of a merchandiser: A manufacturer has negotiated with a chain for x% of the shelves. The manufacturer's commercial services negotiated with the chain's buyers and agreed on that x percent. And then the merchandiser's KPI puts a share of the shelf higher than the official contract. And this is considered the norm in many companies. If a merchandiser presents goods within the terms of the signed contract and does not take up more space on the shelf, he can be fined.

Yes, merchandisers sometimes have the opportunity to increase product representation and shelf space. Sometimes, for example, competitors do not deliver products on time, merchandisers of other manufacturers do not put products on the shelf, and so on. However, such opportunities may appear unplanned, so tasks of this kind cannot be included in mandatory tasks and KPIs for merchandisers. Opportunities may be in the form of expanding the shelf share above the contracted share, undeclared placement on the checkout equipment, placement of additional points of sale, displaying goods better than the network's fixed planogram. It is good if the merchandiser receives an extra bonus for taking the initiative and using the opportunity to do more in good time. This encourages him not to miss out on similar opportunities in the future. Attempts to pass on the responsibilities of a supplier's commercial services to junior staff, on the other hand, are highly demotivating.

Gone are the days when it was considered normal, even in the federal chains, to "move" competitors on the shelf, bypassing the contract, easily expand the share of the shelf and negotiate for additional space in the shop, displaying goods according to the manufacturer's planogram.

Rating

One of the tools for evaluating the effectiveness of merchandisers is the rating of employees within a project. It clearly demonstrates who in the team is seeking career growth, who is seeking maximum bonuses, and who is satisfied with stable payments. From experience, 15 to 25% of merchandisers are ready to move up the career ladder and take active steps towards it. This information helps to balance the motivation system and offer each successful employee relevant bonuses within a single information space. However, it is important to understand the fine line in the rating story so as not to lose focus on teamwork, and to remember that constant competition becomes a source of stress for many merchandisers.

When setting up a rating programme, we recommend using short-term ratings and awarding points not only for completed tasks and KPIs, but also for active participation in educational programmes, mentoring programmes, completed online training sessions and tests taken. Then both experienced employees and newcomers can prove themselves, avoiding the "cumulative advantage" effect.

The effectiveness of merchandisers depends to a large extent on how well they are organised and the realities of their work with specific brands and the specifics of a particular retail chain are taken into account. Therefore, each time you create an incentive system, you have to take into account not only general data, but also to a greater extent the specifics of working with the brands of each particular company.

Back to the Future, or In Search of True Customer Centricity

2021-06-16T11:04:42.666Z

Oddly enough, many salespeople have to take a step back first in order to take a step forward. In order to grow and thrive, they have to change the way they do business. They have to go back to a time when the customer was most important, when stores were full of salespeople eager to help, and when salespeople could count on customer loyalty in return.

In my 30 years in retail, my views on sales have not changed. Nor have the principles behind my programs changed. What I try to teach people is nothing new. And the reaction that I see from those with whom we work is new. All the time I hear: "That's how it was," or "We used to put the client first, too."

The client comes first.

This is clearly for a reason. Society today is far more concerned with the quality of customer service in stores. Years of silent acceptance of mediocre service are behind us - today customers are much more demanding. They are becoming more demanding not only on the value of the product offered, but also on where to buy it. Why would they go to your store when they can buy the same product online or from a competitor cheaper? It's a good time to think about them.

We recently worked with an organization that can be cited as an example of a new retail philosophy that is just now beginning to emerge. The organization, which has 145 stores, has gone from full customer service to self-service and is now going back to using salespeople on the sales floor. They can no longer afford to lose customers because there is no one on the floor to help them. Among the many organizational changes, they are also making the structure more complex. Each person on staff will be responsible for a specific area. The person in charge of merchandising is not responsible for sales. The reason is simple - sales staff should be free of extraneous tasks.

Managers should put more emphasis on working with individual clients. Managers used to be traditionally interested in each customer. Today, it's more about teaching staff how to open and close the store on time and making sure no one is stealing merchandise. It was as if everyone had forgotten the real reason everyone works in retail.

Personal approach.

My grandmother worked in a hardware store. She enjoyed her work and, what's more, made a fair amount of money. She was an absolute genius at working with the customer. Along with her reputation grew the number of customers who came back to see her. Her method was very simple: she paid attention to everyone and was as responsive as she could be. People came back on their own and told their friends. The need for such salespeople is growing now more than ever. Visitors today are looking for exactly that. And if they do, I'm sure they'll come back, and more than once.

You get what you pay for.

One of the problems retailers face is that salespeople don't expect to stay long and, because of that, don't care about the quality of their work. Too often retail jobs don't even allow people to make ends meet. Managers hire part-time staff: such people will work for less money, but will not be loyal to the store. The rule here is simple: you always get what you pay for. Pay less to the employee - you get a less motivated salesperson. Even a simple commission on sales will allow your salespeople to work harder and better and still earn enough.

Not too long ago, a major retailer faced accusations of a sales commission policy that encouraged cheating customers. I firmly believe it was the managers' fault, not the commission system. This is a classic example of a failed system due to the failure of managers. If your boss says you need to sell X units or he will fire you, you have only two choices: either sell X units or start building a resume. Sales commissions have nothing to do with this at all. Their presence or absence should not change anything for the visitor.

Let's say you own a store with revenues of about a million dollars a year. You have three salespeople-one good, one average, and one terrible. Chances are you pay them equally. With a commission system, the good salesman can make enough to live on, and the other two are likely to leave, and you'll have the opportunity to replace them with the likes of the first salesman.

A new trend is emerging in the marketplace, with companies indicating in their advertising that their salespeople are not as aggressive because they don't get a commission on sales. For example, such a strategy has been adopted by a division of General Motors. You can just come into the store, and a friendly salesperson will help you, without any pressure. Well, let's say they work without commission, but I still find it hard to believe that their salary is in no way tied to the amount of goods sold. If I sell twice as much as my colleagues, but get the same amount, how long will I last? Well, okay, let's say they don't get commissions, but it's entirely possible that the best salespeople still get paid more. Maybe they get paid bonuses tied to the amount of product they sell.

If you have to tell a customer that salespeople aren't pushy because you don't pay them a commission on sales, something is obviously going wrong. Being obnoxious has nothing to do with their salary structure, but depends on the atmosphere of the store and their standards of professional behavior. And these in turn are a result of the managers.

As customers, we used to trust salespeople. As salespeople, we were more responsive. There was much more attention to the customer's needs, and more being done in their best interest. I recently saw a story on a TV program that serves as a great example of what I'm talking about. The program decided to do an experiment - they invited eight different repairmen to fix a broken refrigerator. The whole "breakdown" was that the refrigerator simply wasn't plugged in. Out of eight people, only one turned out to be decent enough to take the frivolousness of the problem into account and not charge for the call. Is it any wonder, then, that trust is such a rarity in our society?

The beginning of the end for the middles

In retail, you can no longer stick to a middle ground. Visitors will either be willing to pay more for first-class service, or will be satisfied with low prices and appropriate service. Sooner or later you will have to decide exactly how to position your store, which side to choose. What is better for you: high prices and a high level of service or, conversely, low prices / poor service?

Apparently, the expectations of visitors change according to the amount of money available to them. For example, if you walk into an expensive clothing store, the salespeople will shower you from head to toe. And if you go into a cheaper store, you should expect simpler service. Ideally, the service should be the same in both places. But most stores only try to maintain service at the level you expect, not exceed it. The general opinion is that people will be grateful if anyone approaches them at all. And in expensive stores, customers expect quality service, and if no one approaches them, they will easily leave for another store.

You're probably thinking by now that everything I've said isn't news. You probably know that you need to provide a high level of service to stand out from the crowd of competitors, that you need to do something that allows the store to be unique. But are you sure you've done everything you can to make sure it succeeds? Are you sure that your store will give every customer quality service and attention?

Maybe managers used to understand something that we don't now. They may not have thought about advertising, they didn't have computers, but they knew exactly how to talk to the customer. They cared. They knew how to build a relationship to keep the visitor coming back. Maybe the solution to our problems should be looked for there, in the past.

KPI as an indicator of the success of the company's work with merchandisers

2021-05-20T08:32:45.383Z

Despite the fact that the concepts of KPI and motivation have long been part of every employer's lexicon, sometimes it is difficult to imagine how exactly they should work for the benefit of the company - and whether they should work together.

KPI is not just a method for assessing the effectiveness of personnel - it is an indicator of the success of our work with people. Well-trained employee ensures continuous improvement of the quality of services they provide, opens up opportunities for professional and career growth of employees, and also increases the attractiveness of the company's brand as an employer and a business partner. An effective, professional, well-trained field staff structure is what should differentiate a company from its competitors.

Corporate University

KPI and personnel motivation are important as a package, so it would be wrong to consider one in isolation from the other. First of all, this is due to the understanding that one of the main challenges for the HR department today is the problem of balancing the goals of the company and the goals of the person working in this company. In order to achieve maximum efficiency it is necessary to link them together into a single algorithm of training and career development.

Work with motivation begins first of all with the identification of employee's goals. For this very purpose, companies create a Corporate University, a convenient mobile online platform for personnel development. The Corporate University is not just a set of courses, but a system of adaptation and development of employees, the basis of which are career tracks - programs which visualize the movement of an employee in his career (grades), and also adds gamification to the training and development of employees

Career track combines in itself a training program and practical tasks from the manager, which allows to work off the theoretical materials in practice.

The career track itself motivates an employee not only to learn, but also to achieve a high business result, which is decisive when moving from one level to another.

Motivational programs (business programs) are also launched by means of the corporate university:

- Corporate University tools allow not only training, but also encourage employees to meet business objectives, which will be confirmed by the supervisor

- Only a checklist completed by the supervisor will be considered a completed stage of the business program, for which additional points can be assigned

- Periodic activities can be assigned on certain dates and it will be recorded in the calendar of the employee

Any activity in the Corporate University (both business and training) brings points to employees, which affect their ratings (intangible motivation), and can also be converted into gifts that can be purchased with points (financial motivation)

Each of the students of the corporate university has a personal account with current statistics and assigned courses, so you can independently monitor your progress of training, see the results and feedback. The employee has access not only to compulsory, but also to optional courses for his development. Gamification elements make the learning process dynamic and exciting: rating systems, awards and achievements motivate employees to get better grades and show additional activity in their work.

Through training at the Corporate University it is possible to get real ROI and identify real goals and needs of employees and thus understand what motivation will best affect their performance.

Such different motivation

As a company with a huge number of field personnel, we understand the importance of the human factor and the need to develop new forms and methods of personnel management. In order to work effectively, it is necessary for an employee to express his or her own professional qualities. Motivated employee, as a rule, does more than required from him by the job description, he participates in the life of the team more often, shows proactivity, takes on additional tasks for self-development and development of the team. The right motivation in this case can be a driving factor.

Let's start with the material aspect. We understand that material motivation is important for everyone, so we have various motivational programs that allow employees to exceed business targets and get extra cash motivation for it. Since motivational programs are tied to employees' KPIs, we increase employees' loyalty to the company and improve business performance. For our merchandisers and sales representatives, such material motivational programs could be an increase in the DPM at points of sale or an expansion of the layouts.

An important part of financial motivation is also the timely payment of wages and clear formation of the final amount: when an employee understands what he gets his salary for, he begins to have a clearer idea of his tasks. Instead of blindly following the prescribed KPI, the employee begins to clearly see the relationship between his work and the salary paid to him - and his motivation to improve his own efficiency increases.

Intangible motivation can include factors that make an employee's life easier and allow him to think about continuing his career within the company. This category includes recognition of the employee's merits, praise from management, comfortable working conditions (for example, lining a route close to the employee's home) and, of course, a clear understanding of the possibility of career growth - and here we return to the career tracks already mentioned earlier.

A career track is a sequence of stages of an employee's professional development. In the course of his work he has the opportunity to learn and develop from an intern to a personnel reserve in any of the positions. By going through this program an employee understands that he can grow professionally and in his position, which is often an important and powerful motivation.

The first block of the track, On-Boarding, is available from the start and contains basic courses and tests. Successful completion is required. This block is regularly monitored by the training and development manager and supervisor. The employee needs to successfully complete all elements of the block within a certain time frame - for example, in the first month or two.

The following blocks can be opened at certain career stages, for example, after three months of employment (with the necessary condition of successful completion of the first block), or after the completion of certain tasks set by the manager, thereby ensuring a close relationship of development and training of the employee with the actual practice, that is, the implementation of specific business tasks. In this scenario, it is the practical result that becomes decisive for the transition to the next level.

The final stage of the career track is a personnel reserve. Reaching it, the employee confirms that from the educational point of view he is ready for further growth and can apply for a new position. Also, as part of training and career tracks, regular employee evaluations can be carried out to ensure that employees are fit for their position.

Return to KPIs

A motivated employee is much more interested in meeting KPI targets. For our company, KPIs are end-to-end tasks, based on the contract with the client. As a rule, we work with coverage (number of visits, time worked at the sales point, frequency of visits), and also take on project-specific tasks in accordance with the wishes of our clients. To track project metrics, we use project reporting, which gives performance metrics broken down by plan, fact, and projected performance. The metrics for evaluation are compared to the financial components of the company, i.e. when a certain percentage of KPI's are met, what impact does that have on client estimates.

Generating and tracking KPIs is a fairly universal process for companies. But how exactly can we see the relationship between performance improvement and employee motivation? To do this, we use performance appraisal tools - a set of measures in relation to the company's employees, which include an assessment of employee performance and competencies, both commercial and HR metrics

This tool allows us to:

- Achieve an understanding of the level of development of all employees
- To work out the development of managers' skills
- Generate a talent pool process

Performance reviews are conducted regularly every six months and have a clear structure. Thus, the department responsible for the implementation of this process needs a full understanding of the results of each employee, so the first step is to summarize the results of the reporting period. Then there is a stage of planning of tasks for the next reporting period (half a year), taking into account the analysis of successes and failures of the employees for the past period. That is the planning of training and development of employees for the next period takes place.

For the selection of an effective training program the actual qualification of company supervisors - employees responsible for merchandisers and sales representatives - is determined. This is important to understand at what level of development is each employee, as well as to manage their development and efficiency in the business

The next stage is to identify employees at the level of "Outsider", who do not match the position and shows poor performance, as well as identifying employees at the level of TOP, with high potential for development, which then will go to the next step in the personnel pool program.

As the result of the work of each employee affects the work of the team and the company as a whole, we allocate four blocks:

- KPIs
- Assessment of professional knowledge
- Assessment for participation in various HR-events
- Participation of the employee in trainings

At the same time a significant part of the evaluation are KPI-indicators.

When evaluating the efficiency of each block an employee receives points, and depending on the number of points is assigned a professional level: "Top", "Master", "Specialist", and "Outsider". For each level, a threshold value is set, which is reviewed every six months based on the previous reporting period.

Based on the results of the efficiency assessment, further development of the employee is determined depending on the assigned level - thus, it is possible to assess the results, knowledge and skills of employees in a transparent, objective and uniform way.

Thus, we see that Training, Motivation and KPIs work most effectively together as an integrated system. Through training an employee's motivation is revealed, a motivated employee is aimed at meeting KPIs, and through performance evaluation an employee with good KPIs gets the opportunity to move forward on the career track. Thus, by linking all three elements together, it is possible to create an effective well-trained structure of the field staff, aimed not just at results, but also at the development of each employee.

What will the store of the future look like?

2021-03-22T13:35:15.607Z

Due to the COVID-19 epidemic, retail stores had to close suddenly, and now that many retailers are reopening their doors, we thought you might be interested to know what the store might be like for those customers who decide to shop there in the coming months and years. Of course, the practical implementation of some of the experimental solutions and the customer experience may be slightly different from what was originally intended, so we've highlighted all the points where you can expect any changes. Nevertheless, many of the technology solutions and sales tools that Jeff Schmitz discusses in his post are becoming increasingly valuable to retailers who prioritize omni-channel marketing optimization. Some of them can be useful from the perspective of both employee and customer safety. If you have questions about the trends discussed here or how COVID-19 may evolve, contact Zebra.

According to the Zebra Shoppers Study, a majority (77%) of retail sales executives believe that customers are satisfied with today's level of personalized in-store service. However, the truth is that only 57% of shoppers are satisfied. This is a major difference in perception and needs to be addressed if retailers want to increase foot traffic and sales in their stores.

While the majority of shoppers (57%) still prefer the conventional store over the Internet*, this trend will not continue for a long time. Based on current consumer feedback, in five years only 46% of consumers will still be making more purchases in conventional stores than online. (*These statistics come from a survey conducted in late 2019.

We suspect this time frame has shortened because of the COVID-19 epidemic and consumers' desire for social distance.)
But that doesn't mean the traditional retail model is dead, or at least terminally ill. E-commerce has not devalued conventional stores, as the headlines might suggest. 64% of retailers opened new stores in 2019. And online retailers, including those who started out digital right away, are directing their customers to physical stores to implement the buy online, pick up in store (BOPIS) model, as well as to return online purchases. (This is true even today, despite the economic difficulties many smaller retailers have had with COVID-19.)

Retailers also didn't have to abandon the operating principles that have kept their storefronts open for so many decades. At least not completely.

The convenience of online shopping has prompted retailers to create new customer experiences and implement standards of operational efficiency and warehouse management to satisfy the 21st century shopper who expects instant response to their request, whether for information, product or service.

Technology is a major factor in a positive shopping experience

If retailers want to win and keep customers in these challenging times, they must modernize their stores and supply chains. But executives may find it difficult to find the technology to help them understand what's really going on at their locations or in the marketplace and find the reasons for what's happening. And without the right technology, it's nearly impossible to know how to fix problems that affect the customer experience in a store (for example, improper product placement can make it seem like there isn't one), or how to take advantage of opportunities to increase basket size.

At the same time, it can be difficult to understand whether technology is helping or hindering the customer's in-store experience.

That's why retailers and technology solution providers have been taking part in concept stores, such as the Modern Retail Collective at Mall of America, or implementing their own pilot projects in their stores for the past couple of years. Before new technologies like RFID tags, automation systems and mobile platforms can be widely deployed, they need to be tested in real, flexible environments to see which ones actually improve the customer experience in the store.

For example, can real-time assortment management and, in particular, replenishment of merchandise be better managed with an "eye in the sky" tracking system? And can this system help figure out which clothes a customer tried on and bought, and which ones they left in the fitting room or put back on the shelf? (Or even control the distance between employees and between employees and customers?)

Some may simply want to know if investing in new mobile computers at the point of sale and warehouse software is enough to give employees smart tools and improve the customer experience. Others need to integrate additional smart technology, such as the Internet of Things (IoT), prescriptive analytics or even artificial intelligence (AI), to meet today's retail requirements. And how much can an intelligent automation system improve the customer experience? Would a robotic device that checks the presence and display of items on the shelves help prevent shoppers from leaving empty-handed? Could the entire inventory management process be reduced to the installation of shelf cameras connected to the AI? (This measure also promotes social distancing in stores by reducing the number of employees controlling items on the shelves. Employees could be sent with merchandise to specific shelves only if those items are confirmed missing. This will minimize any contact, including extended contact with customers).

While some questions still await detailed answers, we can assume that in the near future we will be able to better understand the impact of technology as stores reopen and the results of these pilot programs emerge. As this report suggests, already the first wave of the Modern Retail Collective project in late 2019 has provided insights into what technology is improving the in-store shopping experience.

For example, we learned that half of shoppers (50%) like self-service and they prefer not to be disturbed by store employees. (It's suspected that now that COVID-19 requires additional physical distance measures, that number will only grow.) Nevertheless, "small prompts explaining or demonstrating the technology" proved helpful. Another 45% of shoppers "wanted to be shown what to do first and then do it themselves. In most cases they only went to a store assistant when they had questions. Finally, a small group of customers (5%) "wanted and needed help from a store employee throughout their interaction with the tech systems." These preferences could not be detected by the store staff, and formal surveys were needed to identify them. (Such assistance will be needed for some time until shoppers become accustomed to the new technology, which is designed to increase their independence and help them maintain social distance.)

Where do we go from here?

If retailers want their physical stores to remain successful in the digital economy, they must move from "systems of record" to "systems of reality" and do so quickly. Only those with a certain level of operational intelligence and task flexibility will be able to adapt quickly to market changes and meet customer expectations. The good news is that, according to Zebra's Intelligent Companies Index, most retailers are pretty close to being called an "intelligent company.

However, technology alone is not enough. As the first wave of the project Modern Retail Collective showed, if retailers want to get the most out of investments, "the introduction of technology must be supported by comprehensive changes in the store.

Workflows need to be redesigned and employees need to be trained to strike the right balance between technology use and human involvement so that technology doesn't become a disincentive. (Keep in mind that technology does not replace store employees. It allows them to become more efficient, while giving customers exactly the independence they want).

Merchandising strategies also need to change to account for the natural flow of customers in stores and customer interests, data on which is mined, of course, by technology. What's more, performance metrics need to better align with customer expectations and behaviors and become more actionable. Simple key performance indicators (KPIs), which were sufficient five years ago, may no longer be a meaningful measure of success. (Even the metrics that were in use six months ago may have to change due to COVID-19.)

As noted in the McKinsey report, "A broader set of input and output metrics must be tracked to truly measure the success of omni-channel marketing. Employees need to measure their impact on the omni-channel customer shopping experience and help take specific and measurable in-store actions."

To summarize

While we're not exactly envisioning the store of the future yet, it's safe to say there will be a combination of mobile systems, RFID, analytics, and intelligent automation. These technologies will allow retailers to see what's happening in any area at any given time, understand why it's happening, and know exactly what to do about it. Store employees will no longer guess how much their actions help or hinder customers, and customers will no longer walk out of the store feeling unsatisfied.

Online Merchandising: How to Increase Sales in the Post-Coronavirus Online Retail Market

2021-02-17T13:40:50.374Z

The pandemic has accelerated the development of online commerce. This dynamic growth is reinforced by the fact that 10.9% of purchases are already made online. When self-isolation began, online sales became a priority even for companies that had not previously used this channel or had given it secondary importance. Retailers in all segments, from appliances and apparel to food, have significantly increased their reliance on digital sales channels. They are increasing investments in IT infrastructure, changing approaches to consulting and loyalty programs, and rebuilding logistics.

The active transition of retail to online has sharply increased competition. So, in the new conditions it is not enough just to add products to the online store - it is necessary to competently fill out and design product cards, making them stand out from the crowd and raising them in search results. This is how a manufacturer can attract the attention of customers and increase their loyalty. Online merchandising helps to solve these problems.

What an online merchandiser does

In classic retail and online stores, merchandisers perform similar functions. In the offline environment, these are presentations and promotion of products, selection of shelf space, and distribution of promotional materials. In the online environment, sales are stimulated according to the same principles, only we have to deal not with physical, but virtual multi-brand showcases.

Online merchandising is not a one-time optimization, but a continuous effort to stimulate sales. It covers three main areas:

Creating, designing and keeping merchandise cards up to date forms a favorable first impression of the products.
Optimizing the card display helps customers find the right products more quickly.
Product promotion makes products more attractive and recognizable in multi-brand online stores.

Let's talk about how to solve these problems more effectively.

Working with product cards

A product card should be in harmony with the overall design and organization principles of the online store, but at the same time set the brand apart from competitors by attracting consumers to it. This should contribute to all components of the card - from correctly selected photos to a description of the product features.

What should be in a product card?

High-quality photos that give the fullest possible picture of the product. For example, a product card for appliances can be accompanied by six pictures, four of which show the entire device from different sides, and two - separate fragments. Then the buyer can not only assess the overall appearance of the model, but also study important details: the location of connectors, functions of the buttons, and more.
A concise description with the main advantages and features of the product, which will draw attention to it when comparing it with peers.
The block with the characteristics. It is in the interest of the manufacturer to make it as detailed as possible to inform consumers as fully as possible. However, online stores, as a rule, bring the lists of characteristics to their own standard and remove what does not fit into it.
Additional materials that can influence the decision to buy: instructions, environmental certificates and rich content, such as videos, 360 animation and interior photos.

What mistakes should be avoided in the first place?

The selection of photos does not allow you to see the product from all sides.
Photos are unprofessionally taken, which makes the product look unattractive.
The photos do not focus on the key features of the model.
There are no photos that show the product in near-life conditions.
The description is outdated and does not correspond to reality.
The product is described too extensively, without a clear structure and with a lot of unnecessary details - this prevents the customer from quickly finding the necessary information.

To ensure that the information always stays up to date, it is important to update the cards promptly, replacing or removing outdated data. In addition, the online merchandiser should keep track of changes that retailers make to the card form. After all, such updates can add interesting features, such as support for additional types of content or new sections in the features block.

Picture Optimization

Once a card is designed, a good online merchandiser makes sure it is displayed correctly in the online store. The product should be easy to find in the general catalog and the relevant product category, including filters and keywords.

To ensure that catalog positions are displayed correctly for consumer queries, retailer content managers can set up filters for each product themselves. But sometimes mistakes occur in this process. As a result, products can be displayed in searches using irrelevant filters or not displayed when the filters are set correctly. So control by an online brand merchandiser is still necessary.

To make it even easier for customers to find products, keywords can be assigned to each card. This task can also take over the online store, but there is a risk that it will not cover all the relevant queries of buyers. In order to achieve a more effective product promotion in search results, the online merchandiser can compile a list of priority keywords using WordStat, SimilarWeb or a similar service, and then try to find a product in the catalog using those keywords. If some queries remain uncovered, you can discuss the problem with the retailer.

Promoting products

The retailer's marketers usually run SEO optimization, social media advertising and other external promotion themselves, attracting more traffic to the retail site.

After that, online merchandisers step in to handle internal promotion. And they can use a variety of tools:

Special offers. An online merchandiser is able to completely take over the implementation of these classic activities on the online site. In particular, he can launch a special offer, add banners to product cards and make sure that notifications of promotions are properly displayed on the site.
Additional promotional tools: branded webpages, banners and pages. The online merchandiser works on them together with the online store account manager. Ads are optimized and converted to formats which help prevent display problems when using different versions of the site.
Cross-selling. The average check can be increased by promoting related products. Usually, online stores automatically generate their lists without linking them to brands. If the online merchandiser has a good relationship with the site's representatives, he or she can suggest expanding or changing this list so that shoppers see related products from the same manufacturer more often.

Online merchandising is already beginning to play a key role in the uptake of the e-commerce marketplace. As e-commerce continues to evolve, the importance of this tool will only grow as it helps large manufacturers increase sales on multi-brand sites, attracting more consumers. At the same time, companies that underestimate the potential of online merchandising in today's market risk losing the competitive battle for customer attention.

Figital retail replaces digital

2021-01-14T17:34:19.566Z

The omni-channel model of digital-retail will be replaced by a new concept - phygital (from the combination of the words "physical" and "digital").This forecast was shared by Olga Sumishevskaya, Director of Consulting Services for Consumer Goods and Retail Companies at the Retail Experience conference.

The preferences and behaviors of shoppers are changing - it's obvious to everyone. And retail understands that it's IT that allows customers to buy anywhere, anytime, the way they want. That's why retailers are racing to develop technology portfolios. What's wrong with that?

Today, 76% of chains say that the importance of customer loyalty is starting to grow significantly. A loyal customer is a retailer's main asset. And 43% of retailers believe their customers are very loyal. However, researchers' observations show that today's shopper is more disloyal than ever. Only 7% of shoppers spend 90% of their shopping budget at one retailer, 47% don't ask for help and go to a competitor if the product they want is not available... Meanwhile, 91% of shoppers choose retailers who remember them and can help according to their needs. That is, they value the personalized touch that technology can provide.

But also 67% of customers still want to see and touch the product before they buy, and 64% of shoppers spend more after a personal touch with a consultant.

And at the same time, 30% of customers walk away from a salesperson after the first negative experience, and 50% forget about the salesperson forever after the second negative experience. So, for example, poor service or unprofessional salesperson can nullify all the efforts that have been invested in advanced IT developments.

PwC experts believe that a retailer can retain a client for a long time if they give him the most useful and innovative consumer experience and create a wow-effect at every point of contact - both online and offline. This is the essence of the phygital business model: the maximum consumer experience is created through both technology and physical impact.

Digital technology provides fast and convenient payment methods, personalized offers, virtual experiences, and more. In the world of physical contact (physical) with the client work experienced sales assistants, customers create a pleasant atmosphere, including recreation areas, children's corner, a cafe, provided personal services (stylist, beautician).

And examples of the implementation of phygital-concept already exist. Retailers are transforming stores into places that create brands and unique customer experiences. Walmart has developed a retail-city concept with restaurants, entertainment and service centers. The House of Vans, which opened in an abandoned London subway station, has a skate park, galleries, a concert venue, a bar and a movie theater.

VR/AR in the hands of digital retailers

2020-12-16T15:40:11.156Z

There comes a time when the humanities as well as business exist in such close symbiosis with the world of information technology that linguists begin to write code and programmers, administrators and engineers begin to engage in digital marketing and sales. And sooner or later this symbiosis will absorb all the technologies that are currently known. I propose today to talk about how VR and AR have become a powerful weapon in the arsenal of digital retail.

Let's take an example, you own a furniture store, you have a warehouse outside the city, to which suppliers bring finished furniture. To start the business you decide to open several points of sale. But to bring in each point of each piece of furniture sold is expensive, and to rent large premises are also not really cheap, especially at the start.

But you can, in a small office to offer a person in a catalog to choose samples that interest him, and then loaded into the glasses AR pre-prepared scale model, travel with the client to his home or office and "try on" a cabinet or sofa to a real room. It's interesting and it's the future, after all. I agree that 100% of customers will not be able to agree with such ideas, because many want to "see with their hands.

That is, as prerequisites from the business side, unfortunately, can be called not so much a thirst for technology, as a desire to save money. And if we're not talking about the closet, but, for example, a ready-made interior solution or repair, then put wallpaper textures on the walls, arrange furniture from a catalog, choose carpets and look for curtains, without leaving home ... it's interesting, right?

Looking for a dress but no time to try it on? Need a new headliner for your car? You can choose from all of these things using the technology mentioned above. However, for now, the range of goods sold using AR is limited. Food products, raw materials for production facilities and many other things are difficult and probably impossible to sell with a change in reality.

However, digital retail is not just about goods, but as I said earlier, services. Choosing a tour of interesting places it would be interesting to see those places before buying tickets, and if the buyer is a person with advanced requirements (disabilities) then virtual reality can sometimes be the only way to see the Chinese Wall or Victoria Falls. This is, after all, the sale of a service, which means retail. The service is provided through high technology, which means retail is digital.