Put The Power Of Digital Retail In The Hands Of Your Firstline Workers
You Have The Assets To Digitally Thrive Right In Front Of You
The retail industry is at the tip of the iceberg of the digitally transforming world. Shifts in demographics, in the way information is found, shared and used, and in the near-instant ability to get anything where and how you want it are more prevalent in retail than any other sector. These digitally driven shifts present both challenges and immense opportunities, the latter for those retail companies that can get it right.
It is not about digital for digital’s sake, however. Digital solutions are simply the tools in the hands of people—customers and workers. In retail, it is the Firstline workforce–sales associates and store managers—that uses these tools every day that holds the key to improving the customer experience in a world where consumer expectations keep rising and new entrants keep changing the landscape. The impact of the Firstline worker is immense: Despite the 1.1 billion SKUs available on the top online destinations, physical retail will, by 2020, still be 87.4% of the overall retail industry in the U.S. (online and physical). The in-store experience must transform, and the customer/employee experience must evolve with it to stay relevant. This often means empowering and investing in the Firstline workforce.
Firstline workers are not only brand ambassadors but are often the first to engage customers and see products and services in action. Empowering them with technology can lead to higher-value transactions and increasing brand loyalty. They have the potential to help create a consistent look, feel and experience at every touchpoint, making omni-channel shopping a seamless experience.
Much of this potential remains untapped, as physical retail—and the tools that define the employee, and thus the customer, experience—still has to evolve to be as responsive to the consumer as the online experience. Digital transformation was a $2 trillion industry in 2018, according to IDC, but spending more on technology is not enough.
Inc.Digital and Forbes Insights’ recent research, based on algorithms incorporating 26 sets of metrics of digital transformation success across 135-plus variables, reveals that successful retail companies think about transformation very differently from their less successful peers.
These retail digital thrivers account for 40% of the retail sector but are generating over 60% of the economic benefits. What sets them apart is that they are 3.5 times more likely than their peers to invest in new skills and tools for their Firstline workers, thus enabling them to create delightful customer interactions.
Omni-Channel Consistency Sits With Firstline Workers
The significant differences in consumer satisfaction with online experiences (generally much higher) versus consumer satisfaction in a physical retail store are something retail brands need to address in order to give consumers a truly consistent omni-channel experience.
Michael Gale, coauthor of the Wall Street Journal and Amazon bestseller on digital transformation The Digital Helix: Transforming Your Organization’s DNA to Thrive in the Digital Age, explains how to create a uniform and delightful customer experience: “Technologies are replaceable, but the way retailers can lever those moments with technologies and people will be the new asset base for digitally thriving retailers in the next 10 years.”
Putting the right tools in the hands of Firstline workers involves aggregating a range of insights, ideas and perspectives with near-instant ease. Imagine being able to bring together logistics information, peer Firstline feedback on what a like-minded consumer did in other stores, and then accessing wider social media ideas during that consumer interaction.
Consumers want all the power of a digital experience in person. The power to connect expertise through the hands, words and actions of Firstline workers means they will now be seen by consumers more as educated advisors than as sales assistants, focusing on the higher-value interactions where margin, total revenue and even OPX reductions can be instantly delivered. The illustration below is a simplified view of the data consumers might need in that sales moment with a Firstline worker. In these 15 separate elements lie thousands of different examples of combinations. The right technologies, vision from leadership and organizational design can make these real right now.
“Human value is the distinctive difference we have seen in all our research work in retail,” says Gale. “Being able to use technology and platforms that the consumer and the employee can share in real time is like making the employee a retail doctor and not just the administrator. It is the bridge needed to make physical retail truly appealing in a digitally minded age.”
Thriving Retail Companies Are Already Transforming Because Of All The Digital Market Developments
The Digital Helix defined seven digital drivers that are transforming the world around us:
Thriving Retail Companies Are Reorganizing With Firstline Capabilities As A New Core
Inc.Digital and Forbes Insights designed additional research to extend learnings and the models from The Digital Helix by testing which of the seven digital drivers companies were focusing on for success in retail. We found that retail thrivers were consistently leveraging all of these drivers, while other retail companies were only starting to plan to leverage some of them.
With the retail sector being the most affected by the seismic changes illustrated by the seven digital drivers, we found that retail thrivers were more open to organizing differently for success than companies in any of the 10 other industries. Firstline workers are not successful by accident—retail thrivers understood that three organizational dynamics are vital for success, and each connects to the well-being and productive power of the Firstline worker. You could call this an ongoing cycle of interactions that drive Firstline power.
Firstline Success Takes Place at the Intersection of 3 Insights
Thrivers recognize that the moments sales happen can be more fleeting than ever before and that all moments of customer experience need to be leveraged. For a Firstline worker this means making the right decision at the right time about how to help the customer by, for example, answering questions about the fit, appropriateness or availability of a product. An inability to help the customer might just lead the consumer to walk out of a store, and also hurt the customers’ relationship with the overall brand. Not surprisingly, successful retailers see the ability of their Firstline workers to make the right decision in the moment as being 65% more important to success than their peers do.
Each moment matters. Our research revealed that the digital thrivers focused on the Firstline concept saw an 18%-plus difference in economic returns from focusing directly on each moment, versus peers who had not fully organized around each and every moment of the customer experience.
Themes And Streams
To enable Firstline workers’ access to the customers’ portfolio of experiences, retail thrivers are organizing around using new insight and data models extremely well. They are building systems to take in new data forms and new sources at a very aggressive rate, focusing on data management and creating digital data flows that are more visible and available to everyone from the edge or Firstline through to the logistics and back end. They recognize the power of what Inc.Digital calls “themes and streams” of information. More modern tools are needed to enable Firstline workers to effectively live and breathe with the data in real time.
In turn, Firstline workers, who are the eyes and ears to the outer world—working every moment of every day with the consumer on the edge of the retail company—should be able to feed their insights back to the central planning processes. Developing the right tools to empower them in consumer interactions and giving them ways to place valuable market and consumer insights back into the systems is vital. This requires instrumenting the environment, digitizing workflows and providing Firstline workers the modern tools to be successful every day. It’s this holistic approach to empowering Firstline workers that delivers a superior employee and customer experience. Organizations need to transform the entire experience with connected, intelligent and secure solutions.
Customers Have Portfolios Of Experiences
Customer experience moments do not happen in a vacuum. They are part of a vast portfolio of experiences, which customers have gathered while shopping in physical stores or online, interacting with a specific brand or multiple competitors’ brands, and which may have happened through their own direct experience or been shared with them by their friends. All of these experiences drive how they act in any given moment.
Simplistically, we could call this a 360 view, but we should be aware that certain experiences may matter more or less depending on the situation the consumer and Firstline worker are in. The power lies in the Firstline worker’s ability to access and use the relevant parts of the portfolio at the right time. To this end, Firstline workers need the right real-time tools to understand the context for customers’ needs and deliver a superior experience in that moment.
The instant nature of consumer or customer requires a deeper integration between the data being collected and the tools that are needed by the Firstline worker. This is especially sensitive to the balance between generating access to near-real-time information in front of a consumer and preserving the security of consumer data, potentially on the retail floor as the interaction happens. The balance between data compliance and the ability to answer potentially highly detailed questions in the moment (consumer history, pricing, availability, comparisons, etc.) means we need to rethink how important new strategies for security need to be.
The Four Imperatives For Firstline Success In Digitally Thriving Retail Corporations
There are four clear imperatives that outline how to fulfill consumers’ needs by putting the necessary tools in the hands of Firstline workers.
Evolve Your Firstline Workers From Assistants To Advisors
Empowering Firstline workers to understand customers’ needs and make relevant decisions at the right time effectively elevates their status from assistants to advisors. As such, it leads to better sales outcomes—and to realizing incremental value from every sales moment.
Customers reward Firstline workers’ empowerment very quickly. Our research showed that while only 23% of all retail corporations enable such empowerment, they garnered 35% of the ROI for digital transformation-driven benefits in terms of customer acquisition costs, retention costs and brand equity.
Invest In Your Firstline Workers With New Mindset Training And Skills
Mindset skills are key for Firstline workers if they are to make fast, in-the-moment decisions. Our research revealed that retail companies generally understood that mindset training skills matter, more so than executives in eight of the other industries. Digitally thriving retail companies were three and a half times more likely to be heavily investing in this training than their peers. These retail thrivers also invested more in management training and digital skills than their peers. Firstline employees clearly matter more to the retail digitally transformed thrivers than to their peers. This is not an accident but a design that is leading to their clear success.
Position Your Firstline Workers As Your Experimentation Frontier
The power of Firstline workers is that every moment of engagement is a potential experimentational moment. Digital is about lots of connected small steps, so instead of taking one large bet, consider taking lots of small ones from the insight and actions of your Firstline workers. The most successful retail digital thrivers were 2.5 times more committed to ongoing experiments as a strategy for success than all their peers. Thrivers who are more comfortable with constant change got better economic and brand returns (three times more) than peers that were not.
Firstline ability to experiment and share learnings is a vital component for handling constant change and the need for constant experimentation in real time. If knowledge is the center of the digital age, then the application of that knowledge in real-time moments with Firstline workers is the very tip of the spear for retail companies.
Technologies Need To Connect To Value-Added Capabilities That Go Far Beyond Traditional Boundaries
Firstline workers need technologies that enable them to participate in the digital information flow of the organization in real time. They should be able to feed insights into supply chains and get instant feedback, instantly update social media and have access to up-to-speed social media networks, and share and exchange information with customer service and sales. Firstline workers need technologies that let them help change processes on the fly (supply chain, marketing, sales insights), and they will need to do this on vastly more moments than before.
Integrating Firstline workers into the data flow calls for technology that thrives from the edge, not just from the center. This has two key implications because data systems need to be integrated in a way that can accommodate the esoteric needs of each consumer a Firstline worker has to manage. It falls on the retailers to ensure that they make Firstline workers the cornerstone of their digital success.
- Security becomes a really vital component because of the constant flows of information coming into the system (social and internal feedback from Firstline peers and customer information) and leaving the system via a screen shown to a customer the Firstline worker is assisting. Security becomes a strategic differentiator for these moments (live and with a customer). Paying attention to how the IT function thinks, designs and acts around this also means partners you select need to see security as a strategic part of the design process.
- A fundamentally more fluid set of interactions between the edge and the core means everything has to work together better. Your Firstline workers are not IT solution technicians, nor should they ever be seen as that. Your technology platforms and partners need to be architected around the ability to move information around rapidly in easy-to-use and highly customizable interfaces that work for your retail sector.
Technology continues to enable organizations to thrive, but people remain at the center of the equation. It will be these people, the Firstline workers, who move the organization forward. It’s their actions that translate strategy into reality, and it’s the tools that enable them that will establish a high-performing workforce and organization.
Retail is digitally transforming at a rate that exceeds the vast majority of other industries. The preeminent focus on Firstline workers’ power to make decisions on the edge with consumers in each situation is a radical shift in the thinking about how retail companies should be thriving with their digital transformation.
For all the speed, transparency and, hopefully, delight that this approach brings for consumers and for Firstline workers, security and compliance at a deep and structural level are vital for success. This requires a hyper-modern and very intelligent level of architecture and design that is based on one core platform. Security and compliance become assets in this environment to enable Firstline workers’ ongoing success.
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