Digital transformation is accelerating as the cost-of-living crisis bites

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Different generations value different elements of the customer experience. Taking that into account is key (Courtesy of Manhattan Associates)

Manhattan Associates is a Business Reporter client.

In an era of economic challenges, retailers must prioritise digitalisation and elevate customer service to meet increasingly discerning consumer expectations.

In an era where tolerance for mediocre experiences is unsurprisingly low, there will always be winners and losers. It’s no longer enough to just serve the customer; today’s retailers must roll out the red carpet, too. Latest research from Manhattan Associates shows that 89 per cent of consumers have altered their spending habits in response to cost-of-living challenges, becoming increasingly selective about how and where they spend their hard-earned cash.

Rolling out the red carpet: mediocre shopping experiences no longer cut it (Courtesy of Manhattan Associates)

As retailers battle to keep up with shifting consumer behaviour, digitalisation is one area that shows no sign of contracting, with many retailers choosing to double down on transformation projects and continue store and omnichannel initiatives across both front and back-end processes. In fact, 26 per cent of retailers surveyed told us that upgrading to a modern point of sale (POS) that can manage omnichannel scenarios is one of their top three business priorities for the next 12 months.

With added pressures on shoppers’ wallets, consumers expect all retail touchpoints to be connected, frictionless and increasingly personalised. When asked what would be the best scenario if a product was not in stock, the majority of consumers said they would most likely look to a store associate for assistance.

Digitilisation is key as the shape of our retail experience changes (Courtesy of Manhattan Associates)

More than one-quarter (27 per cent) of consumers said they would like the associate to check if the product is available in a store nearby, while 23 per cent said they would like them to order the item and have it delivered to the customer’s home or to the store as soon as possible – something that a unified POS and omnichannel offering makes possible.

As automation and artificial intelligence become more prevalent, retail staff will be able to focus on more valuable, customer-facing tasks and transition to genuine brand ambassadors. But how should they be rewarded? What skills will they require? And how much autonomy should they have? These are all questions that retailers need to start thinking about today if they don’t want to lose their brightest and most talented staff.

Beyond the sale: The jobs of the people who make physical stores function must now evolve (Courtesy of Manhattan Associates)

It’s certainly true that the most successful retailers are those that are guided by the customer, but what does today’s customer value most from store associates?

According to consumer respondents, it’s having knowledge about the product they are thinking of buying (49 per cent), followed by having the ability to demonstrate a product and physically show it to them (24 per cent).

Older consumers (55+) are most likely to consider these as the most important aspects of a shop assistant’s service, whereas younger consumers are more likely to think that having personal experience of products, suggesting other products that go well with what they want to buy or checking stock availability are the most valued aspects of a store associate’s service to them. These variations highlight the generational nuances that need to be taken into account by retailers.

On the move? Shoppers are increasingly turning to store associates for queue-busting options (Courtesy of Manhattan Associates)

As the role of the physical store evolves beyond the transactional, the job of the people who make them function must also evolve beyond purely assisting the sale. Instead, they must become trusted advisors. This is particularly relevant for categories where the purchase is more considered, such as furniture or consumer electronics, or those that require deeper personalisation, such as health and beauty.

Similarly, shoppers are increasingly turning to store associates for queue-busting options, particularly in categories such as sports, leisure, household goods and furniture. Utilising mobile POS devices to check shoppers out on the spot has the potential to lead to improved customer satisfaction, foster that “red carpet” feeling and, ultimately, increase sales.

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To discover more insights from Manhattan Associates’ latest global omnichannel research and understand how the digitalisation and unification of the supply chain could help your teams to deliver that VIP experience to all your customers, download the report, “Redefining Retail: What’s Next for Shoppers and Retailers?”