The Future of Brick-And-Mortar Retail: Contactless, But Experience-Full
Although the future is unpredictable, some aspects of the post-COVID-19 retail shopping environment are coming into focus. Consumers will continue to buy products online, but there will remain occasions when a customer will want to return to the store. They won’t return, however, unless the shopping is contactless, experience-full and, most importantly, consumers genuinely feel they can remain safe. As some shopping shifts back from online to in-store, it’s important for retailers to bring all available tools to bear in replicating the efficiencies of digital transactions in their physical space, but more so, the ability to have a contactless experience.
To encourage consumers to visit their stores, retailers first need to reassure them that their in-store shopping experience won’t jeopardize their health and safety. Several recent surveys underscore this consumer concern. For example, an Inspire PR Group survey shows that U.S. grocery shoppers are most worried about the perceived health threat posed by other customers. Cotton Incorporated’s COVID-19 Consumer Survey of 500 consumers shows that 64 percent of consumers say they will buy more clothing online, rather than in stores, in the future. A recent Kearney survey (figure 1 below) shows that the No. 1 characteristic of the retail brands perceived negatively during the pandemic was their lack of safety measures and their staying open at the peak of the pandemic.
Supply Chain Within the Store
Second, retailers need to adjust their brick-and-mortar offerings and transform their “supply chain in the store” to better support associates as they pick and pack the products customers order online, and then deliver those items to customers’ cars or to the in-store counter where they will be picked up. While not overlooking e-commerce, retailers will focus on ensuring that the customer’s in-store shopping experience is contactless. This will include reducing touchpoints, streamlining steps to reduce time in-store, and using click-and-collect to meet consumers’ increasingly shifting demands (whether vegetarian, organic, farm-to-table, size, or delivery times and locations). These characteristics add up to worry-free, safe, experience-full shopping for the consumer. In short, enjoyable and gratifying.
The ability to provide this shopping experience will require retailers to make major changes in both the front- and back-of-the-house operations. Shoppers should be able to interact online with physical items in-store, and bring the in-store experience home, digitally, as well. In order to achieve this balance, retailers should focus on the following:
1. Digital replication and enhancement of the in-store experience.
Retailers’ post-pandemic success depends, in large part, on how well they can replicate and enhance the traditional shopping experience with digital alternatives that help customers avoid in-store shopping or reduce contact with other in-store shoppers. Their objective is to get in and out of the store quickly. Consumer patience with closed dressing rooms, “all sales final” policies, and other stipulations has been on the wane for some time. Now, it’s up to retailers to develop digital options that facilitate shopping and meet consumer needs.
2. Bring the in-store shopping experience home.
One way to do this might be to replace certain in-store, high-touch counters, such as those for makeup and jewelry, with virtual try-ons using digital apps and augmented reality (AR), allowing consumers to try out more items than they would be able to in a traditional store setting.
To illustrate, we’ll make up a hypothetical shopper who needs the perfect makeup to wear at her wedding in two months. Due to COVID-19 concerns, she shops online, from the safety of her living room. After virtually trying several lipstick colors via AR, she buys her usual shade. In addition, taking suggestions from the app, she adds two new colors of powder and makeup. This shopping experience was streamlined, safe and convenient, allowing her to choose from more products in more stores than she would have been able to do in person.
Another way of bringing the store home might be to replicate apparel dressing rooms with virtual try-on apps that let customers scan up to 40 measurements with a smartphone, then use video chats to provide personal customer consultations. Helping customers find the perfect fit for their next big event in this way can bring added quality and value to the shopping experience that parallels or even exceeds the pre-pandemic in-person brick-and-mortar experience.
3. Enhance a streamlined in-store experience.
Streamlining the in-store experience while finding continued enhancements will help customers spend less time in stores (and around other customers) while remaining delighted by the experience. Retailers can bring the browsing experience to customers’ homes by offering online virtual store walkthroughs, then organizing their shopping lists into optimized routes through the store. When customers are ready to check out with their smartphones, scan-and-pay apps and an integrated wallet with pre-loaded coupons and reward dollars render the experience frictionless. These and many other digital enhancements can give consumers shopping experiences that, while different, could be as good as or better than those they had before the pandemic.
Replication and enhancement of in-store shopping will require retailers to make a stepwise change in their technology requirements and application support, which must be supported by strong digital teams and infrastructure. While many of these technologies are cutting edge, all of them already exist and are being used across industries today.
This means they're available for every retailer, large or small, that wants to invest in the latest technologies and use them to improve their customer service. Doing so will enable retailers to use the current COVID pause to change the way they do business, giving their customers an improved shopping experience — both online and in-store. A better online experience will result in greater customer satisfaction and fewer returned items, which, in turn, will provide retailers with a more profitable digital business. It will also enhance in-store shopping for those who prefer brick-and-mortar stores and want it to be safe, streamlined and experience-full.
Suketu Gandhi is a partner in the Digital Transformation practice, Alanna Klassen Jamjoum is a specialist and vice president, Alex Fitzgerald is a principal, and Justin Pham is a manager in the consumer practice of Kearney, a global strategy and management consulting firm. They can be reached respectively at Suketu.Gandhi@kearney.com, Alanna.Klassen.Jamjoum@kearney.com, Alex.Fitzgerald@kearney.com and Justin.Pham@kearney.com. The authors would like to thank their colleague Michael Brown for his contributions to this article.