The world of retail had always debated the real value of online shopping. The C-suite of retail giants adopted online channel because of the fear of missing out (FOMO). Most of the big retailers in Ireland, do have online departments who look after the online trade, but the management and investors had always shied away from investing more in improving these platforms. We do see this changing now, more so with the impact on the instore shopping during covid. Ireland was always behind other countries like UK, US and China and in terms of online penetration, but we have seen the retailers now catching up.
The most common change has been seen with grocery shopping. Supervalu and Lidl now have their loyalty apps and have been using their data very cleverly to entice shoppers to come back. While these grocers will remain predominately offline, in coming years we will see a growing share of online shopping from their customers.
While big retailers can afford to invest in having an online department, small retailers can barely afford to have a dedicated employee to look after the website. It has been a real challenge for small retailers to first invest in technology and secondly to spend regularly in maintaining their online platforms. This was much harder when they saw only a small proportion of sales coming from online and no metric available to compare its impact on instore. Large retailers had loyalty apps and other analytics systems to measure and identify the impact of these online presence in their instore environments. Having said that, the small businesses and specially the local businesses have seen a real benefit of online when their stores were shut down during lockdown. Businesses who had an online store or were quick to build one, survived while rest had to close down. When the lockdown was lifted last time, some of the retailers and businesses reported that nearly 50% of their customers still wanted to shop online. This changed customer behaviour of shopping across both channels has given these small businesses a real reason to sell across both channels. In the investment world we always talk about diversification of portfolio to reduce risk. Isn't an omnichannel approach a diversification in business itself ? Do we need to say more and prove with complex data models as to why an omnichannel approach is important, even for small local retailers?
There has been advancement and innovation in various platforms that offer services to small businesses . With platforms like Shopify and Wix , it is much easier to build a store, add features that are important to your store, integrate with your fulfilment providers and automate rest of the aspects. Not only that, as these platforms are cloud based, the small retailers need not focus on the updates and downtime or hiring a developer on platforms such as Fiverr. This allows the business owners peace of mind to focus on what they know the best i.e. selling. Technology and automation allows the leaders to be business owners and not business operators.
The small businesses need to think outside the box to leverage this opportunity. It will only lead to evolution of the retail landscape.
We at Technik enable small businesses to use this opportunity of the changing times by leveraging the digital world.