Improving Store Labor Standards: A Key Ingredient for Successful Store Execution

While the chorus around omnichannel and digital commerce’s growing impact and the need to transform stores becomes louder every day, retailers need to account for how these changes affect the work associates perform and the store’s labor budget. The reality is that a majority of retailers are unsure of how to upgrade labor standards and labor hours for maximizing store productivity and ensuring smooth operations. Labor standards are defined as the average amount of time it takes for store associates and managers to complete customer service, sales and operational tasks in the store. Retailers use a varied set of sales, customer service and operational labor standards for day-to-day store execution. In order to achieve consistent store execution, retailers need to ensure that all these standards are always in line with constantly evolving customer expectations, labor regulations and related store labor policies/procedures. Effective labor standards and related standard operating procedures (SOPs) in the stores include accurate labor planning for all tasks, performance evaluation, insights for operational improvements and cost minimization and above all documentation of the best methods. EKN recently conducted a survey of 63 US retailers and spoke to several softlines and hardlines retail executives to understand their viewpoint on this key retail store execution area. The general consensus is that labor standards are not well documented or updated effectively within the retail organization. In fact, nearly two-thirds of retailers (64%) update labor standards and labor hour models infrequently- range from quarterly, annual or on an ad-hoc basis. Another major business pain that retailers are experiencing is the lack of proper organizational management and consensus on issues related to...

Elevating The In-Store Experience: What we forget

The death knell to the store has been rung frantically more than a few times and projections by leading firms had them lurching in obsolescence by now. But, to paraphrase Mark Twain, the news of the death of the store have been greatly exaggerated. We took this point of view back in 2012, when we released our first Future of the Store report (not store of the future!) and tried to reimagine the utility of the store in a channel agnostic world. Subsequently we evolved our thinking to look at stores beyond a utilitarian view and focus on what actually differentiates them against other channels, the experience. Retailers need to double down on making their stores the hub of omni-channel experiences. To be clear, this isn’t a store of the future vision, that involved putting all kinds of bells and whistles in the store with little understanding of how real customers would react and adopt technology. This is about building the store experience, customer first where technology and information need to empower, enhance and not dehumanize the store experience.   Stores need to stop being boring. “Stores as large, soulless, cookie cutter stock rooms and showrooms will give way to more immersive experiences as the physicality of the store converges with the digital experiences it enables through technologies such as NFC, iBeacon and Internet of Things. This will require reprioritization of various roles the store plays based on their format and customer engagement strategy. Retailers will experiment with new formats such as flagship and pop-up stores” – EKN Future of the Store Report 2013 There are many pathways to...

Retail Associates are not Set-Up for Success

We recently authored our 2015 retail associate or labor related research: Managing and Engaging Modern Labor for Omni-Channel Success. The objective behind this blog is to highlight the need for a different labor model in retail and why so many associates in retail are destined to fail at their jobs even if they are sales or operational superstars. For those of us who made a career in retail by working our way up from the stores know that most retail executives in marketing, merchandising, IT and even store operations (you read correct!) are often surprised to learn that associates perform new, unique and often innovative Omni-channel tasks in the stores every day. There are ever increasing numbers of tasks including but not limited to: loyalty, offers, price comparisons, up-sell/cross-sell, inventory look-up, and ship from store, endless aisle, in-store pick-up, integrated payments to more complex Omni-channel order processing and returns. Our latest stores survey indicates that 84% of retailers are increasing number of online orders fulfilled from the store, only 31% are increasing employees per store. Today, stores need to deal with more Omni-channel tasks and more or less the same labor that performs these tasks. While such store tasks are performed to achieve real-time message personalization to customers and unified merchandising/inventory execution across channels, in reality these tasks determine the fate of sales uplift, gross margin and customer satisfaction in the store. Our research indicates that Omni-channel message and order personalization in the store remains a top challenge for 1 in 2 retailers. The role of the associate therefore acquires paramount importance. Some may argue that arming associates with...

Customer-Centricity: The Holy Grail of Omni-Channel Merchandising

While retailers are making great strides with customer-centricity in marketing and customer service, merchandising has not made the same progress. The move toward customer-centricity will require not just higher levels of coordination but for many retail organizations dramatic cultural change. Download this benchmark report to learn about priority initiatives, challenges and technology trends in 2015 & beyond related to building customer-centric merchandising/assortments and discover areas related to business processes, technology and strategies where best-in-class retailers focus. Download Full...

Only the Nimble Survive.

In his now viral “4 Horsemen” video, Professor of Clinical Marketing at NYU Stern Scott Galloway boldly proclaims that pureplay retail of any kind – online-only or brick and mortar only – is dead. We agree. Not many will argue that retailers need to combine online and offline experiences and deliver an integrated, personalized experience to shoppers. In fact, according to EKN’s annual Future of Stores industry benchmark, 97% of brick and mortar retailers believe they can leverage stores as their strongest differentiator against online-only retailers; yet, 82% rate themselves as being significantly behind, in terms of offering consumers flexibility and speed of order fulfillment. When it comes to delivering a seamless, “phygital” customer experience, why is no longer the question. How retailers transform, and what specific capabilities they need to prioritize are less clear. Towards this end we’re excited about upcoming global research we’ve partnered with IBM on. Together, we’re exploring the definition and business value of “agility” from a retailer and consumer product manufacturer’s standpoint. We’re attempting to build greater industry specificity around an otherwise esoteric concept, specifically focusing on agility as it relates to: Quickly adapting organizational culture, structure and processes to changing market trends. Market leaders across categories are being challenged by dynamic new business models that will force them to quickly evolve or lose market-share and customer stickiness. Securely integrating new technologies into the enterprise IT architecture. The increased use of consumer devices and services in the enterprise, the imminent rise in the number of connected devices, lack of standardization of technology platforms across the web and mobility spectrum, and the increased adoption of...