In-store retailers have the data they need to improve their businesses - but they're missing the tech

Ged Scheuber, COO & Head of Product


Today, it’s the high street brands without their own online shop that stand out as exceptions to the rule.The channel itself has seen a strong growth in sales figures over the past few years, with the value of online sales in the retail sector going from 2.7% in January 2007 to 16.1% in January 2017 — a massive leap. Whilst it means good news for online-only businesses such as Asos and Boohoo, the brands that once owned the high street are now rushing to keep up. And though in-store retail hasn’t seen as shocking a decline in sales as online has seen a rise — with a drop of 0.1% in revenues during the 2016 Christmas period, whilst online grew by 19%, compared to December 2015 — it’s hard to avoid the articles reporting on the death of the high street shop. Bricks-and-mortar needs to put its best foot forward, and retailers need to look to technology to enable this.

The technology behind online sales platforms has seen huge developments over the past few years. And that makes sense, as the very nature of the channel wouldn’t exist without tech. In-store, on the other hand, has seen fewer and much slower adoptions. Yes, it’s a channel that has existed long before these innovations came about — but that’s not to mean it shouldn’t embrace them. And while the past few years have seen some customer-facing technology be implemented by high street shops, it’s the way these businesses are run that most needs a digital transformation. Last week, Rotageek published a research report looking into what’s at stake for retailers who are too slow to adopt new technologies. The research focused on staff scheduling and its impact on employee well being and the bottom line. A number of issues were highlighted — one of them being retailers’ difficulties with predicting the right amount of staff needed in-store on any given day.

Our research found that 41% of retailers admit to often wrongly predicting the number of staff needed in store. This can have a significant negative impact on quality of service — something that, really, bricks-and-mortar should excel at. The data necessary to make better staffing decisions exists (transaction data and/or footfall data, for example) but few retailers are putting it to good use. In other words, the information necessary to improve operations is there, but the technology needed to implement it into decision making processes is not. Staff scheduling is only one of many examples where important (but seemingly tedious) tasks continue to run in really outdated ways: Over a third of large retailers continue to plan rotas by hand, often based on nothing but a shop manager’s gut feel. That’s a huge opportunity that’s left unexplored.

Mispredicting staffing levels means one of two things: either a loss of sales, in the case of understaffing, or a waste of staff hours, in the case of overstaffing. But both cases negatively impact the employee, subjecting them either to hours of stress trying to serve more customers than possible on the shop floor, or the opposite — boredom. Neither contribute to employee engagement (on the contrary), and ultimately can lead to staff churn. What’s more, our research showed that 43% of retailers found inefficient scheduling resulted in more complaints from customers, whilst nearly a third admitted to having lost sales due to this. So effectively, this issue of mispredicting demand is a problem for a number of reasons: firstly, it impacts the bottom line. Secondly, it impacts staff morale. Then, indirectly, low staff morale impacts the bottom line. Add Brexit, inflation, and the rise of online sales to this mix of punches and you have a rather bruised high street. But let’s not throw in the towel quite yet.

For some time, whilst online sales rose to unheard of figures, there were some questions about the role of the high street. Would it lose a huge amount of sales to online? How would it keep up? Would it even survive? But over recent years, the role of in-store has been crystallising. Online caters to comfort-convenience and offers endless variety, allowing consumers to order whatever, whenever, wherever, regardless of a retailer’s location and opening times. In-store, on the other hand, matters because it offers retailers a chance to connect with consumers on a much more significant level than offline. Bricks-and-mortar not only caters to the convenience of passersby, it also allows retailers to create a real immersion into a brand, an experience, and this is where great service plays an important role. The data necessary to achieve this already exists in all organisations, but few have implemented the technology needed to make the most of it and achieve not only more effective scheduling, but also more engaged employees.

Today, in-store retail needs to focus on the differentiating factors that make it stand out — not as the less-modern uncle of online shopping, but as a channel in its own right. The data to enable this is already in place, we just need to unlock it with the new technologies that are being developed.