E-commerce

A glimpse into 2021 retail: The times they (will continue) a-changin'

As the wild and bumpy ride known as 2020 comes to a close, David Wilkinson, president and general manager, NCR Retail, takes a look at some of those changes and what's ahead

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January 19, 2021 | David Wilkinson

Although filled with plenty of volatility and uncertainty, one thing that's safe to say about 2020 is that it has forever changed the world of retail as we know it. At the end of Q3, e-commerce reached nearly 20% of all U.S. retail spending. However, 91% of consumers say they miss shopping in stores. As such, there's no time like the present to make technology changes that will keep them coming into your stores into the new year.

As the wild and bumpy ride known as 2020 comes to a close, it's a good time to look at some of those changes and what's ahead. The COVID-19 pandemic has ushered in new ways of shopping, but if we stay tuned to consumer preferences and follow their lead to adapt and sell differently, then we are surely headed toward a profitable, successful 2021.

Let's take a peek into five ways in which retail has forever changed.

The new jack-of-all-trades: The store associate

A trend that will spill over into the new year as shopper behavior evolves is that retail employees will continue wearing many different hats.

To ramp up the customer experience and to make shopping safer, employees will continue cleaning more frequently and thoroughly and re-stocking earlier or later than normal to help minimize contact with guests. Store associates — in the burgeoning hybrid, in-store/online setting — are chipping in to fulfill same-day delivery, curbside pickup and drive-thru orders and are even being tasked with using tech to take on virtual customer service.

In fact, 35-45% of consumer behaviors from COVID-19 will persist after the pandemic, primarily with digital experiences, which means store associates will continue serving customers differently in the new year.

Real-time inventory — the real deal

Consumers' demand for real-time inventory is at an all-time high, and they will expect to have visibility into what retailers have in stock going forward, too. Since buy online pickup in store and curbside has surged during the pandemic, real-time inventory management throughout the supply chain has never been more important. Shoppers love the thrill of the hunt and will continue coming into your stores as long as you make it easy (and safe) to swing by and pick up their item quicky. This means that when they make the trip, they will expect that what they saw available online or ordered for pickup to be in stock.

Therefore, ensure that what you offer for on-site pick-up is actually there in-store — or risk losing customers. This means you may need to invest in new technology to satisfy consumer demand.

By making sure real-time inventory visibility extends through the supply chain, you can ensure your online platform matches product availability and remains competitive with e-commerce giants, who have years of experience providing consumers with real-time information.

And as shoppers lean more heavily on e-commerce, the nature of fulfillment will continue to change.

The dark store emerges into the light

Online ordering is projected to have grown by nearly 20% increase this year and shows no sign of slowing down. To accommodate this uptick, more retailers will turn to the dark store model that has been gathering steam for years and taking off in recent months. By transforming former brick-and-mortar shopping locations into fulfillment-only centers, retailers that include Macy's, Whole Foods and Kroger are toying with the benefits of dimming the switch to see the light of the new day. In fact, retailers in many verticals have taken this route since the start of the pandemic or plan to take it soon, and the benefits are stacking up.

Changing struggling locations into dark stores allows retailers to streamline operations and re-optimize store space into thriving, last-mile, e-commerce fulfillment hubs. With the absence of physical displays, checkout lanes and customer service queues, every square inch of the former store can be allocated to fulfillment only, allowing the dark store to carry more products and design the layout to serve pickers, not consumers. Altogether, this model can provide faster delivery times for traditional retailers, allowing them to provide same-day delivery and better compete with the lightning-fast offerings of e-commerce-only leaders.

As this model becomes more commonplace nationwide, dark stores in 2021 will become increasingly sophisticated through technologies like those seen in larger warehouses, including robot pickers, for quicker, more efficient operations.

Going all-in on innovative tech

As curbside and BOPIS are now table stakes in the United States — and globally. Self-scanning in aisles via mobile apps has been deployed in the United Kingdom and the grab-and-go model popularized by a select few Amazon Go outposts may become more quickly widespread. In the payments sector, contactless or "tap-to-pay" is a cornerstone of 2020 adoption, but in years to come, blockchain, distributed ledger and other alternative payments could become commonplace.

With such sweeping change on the horizon, you must be ready to just do it and adapt.

Consumers will continue gravitating toward digital — or a hybrid of digital and in-store shopping. To meet shoppers where they are, retailers like you must evaluate your existing technology and decide whether it can keep up with the experience customers crave.

Yes, investing in retail technology is pricey. However, what's the price-tag of failing to deliver what your shoppers want, particularly if your competition is willing to pony up?

It's imperative that in-store technology allows you to plug-and-play new solutions without complicated or lengthy integrations on the back end. By taking a holistic approach and ensuring tech stacks are primed to integrate the next big thing, you can be ready for the continued innovation for which 2021 is primed and ready.

David Wilkinson is president and general manager, NCR Retail