18 July 2023
18 July 2023
This article shares key takeaways from our webinar The New Retail Standard: How Frontline Team Management Must Change to Future-Proof Your Retail Organization. Watch the on-demand recording.
Economic uncertainty, inflation, shifting shopper habits, evolving employee expectations… Changes have come fast for retail and hospitality in the post-pandemic landscape.
Some leaders are adapting to meet the challenges of this complex, new consumer paradigm.
Others are stuck firmly in the status quo and at risk of becoming irrelevant. (How often have we witnessed an established industry leader's unwavering commitment to its existing operational framework lead to its eventual downfall?)
If enterprise retailers want to build a business that is future-proof, their omnichannel strategy must place the frontline worker experience at the core — and the time to do it is now.
So then what are the critical factors of change management that differentiate the most successful retailers?
On June 28th, 2023, YOOBIC invited retail experts to explore this question during our live webinar: The New Retail Standard: How Frontline Team Management Must Change to Future-Proof Your Retail Organization. (Watch the on-demand recording.)
In this article, we’ll be sharing key takeaways from their candid discussion, including:
VP and Principal Analyst at Forrester, renowned for her expertise in e-commerce, omnichannel commerce, and consumer behavior
Host of the Retail in America podcast and co-founder of retail consultancy OSSY, brought to the table his wealth of experience in leading retail operations for America's top brands
A senior advisor and former senior executive at prominent retailers like DFS (LVMH group) and Macy's, with over 35 years of global retail acumen under his belt
Sucharita Kodali, VP and Principal Analyst at Forrester, kicked off the discussion with some context-setting market research that underscores the importance of the retail employee experience. The quality of this experience is often the defining factor in a brand's image, considering that these employees are the brand's first point of contact with customers.
According to Kodali, while businesses tend to believe they're providing adequate resources for their employees to support customers, there seems to be a disconnect or cognitive dissonance.
The majority believe they are empowering their employees through digital tools and training, yet turnover rates in retail remain higher than the industry standard.
Source: Bureau of Labor Statistics, “Table 4. Quits levels and rates by industry and region, seasonally adjusted,” accessed June 8, 2023
Despite purported investments in customer experience and a slight improvement in turnover rates in 2022, the retail sector faces enormous challenges in retaining employees and creating viable career paths.
According to Forrester research, the root causes of these challenges stem from the following hourly worker pain points:
Often, frontline employees lack the necessary tools and technology for efficient communication and task management.
Meanwhile, the lack of paths to promotion and exposure to different parts of the business creates a perception of retail jobs as 'dead-end jobs'.
Kodali also pointed out the issues with inadequate staffing procedures and untrained managers. Without strong leadership in retail establishments, employees are likely to leave for other opportunities.
She concluded by emphasizing the detrimental consequences when employees are not well-managed, and high stress levels or burnout prevails. Retention is cheaper than replacing employees, making the investment in a great employee experience and finding suitable employees initially a cost-effective strategy.
A compromised employee experience doesn't only harm the employee but also negatively impacts the customer experience and the brand image. Thus, retailers must strive to manage their employees better to ensure their brands thrive in this changing landscape.
Understanding and addressing the people challenges in retail is key to improving both employee and customer experiences.
During the webinar, our industry experts highlighted four major challenges for retailers:
The panel proposed strategies to overcome these challenges and align with the evolving needs of frontline workers:
All these aspects underline the necessity of human connection, active listening, and responsiveness in the retail industry. It's important for retail leaders to step out of their offices and into the stores to better understand the real challenges and aspirations of their frontline workers, hence finding solutions to match them.
In the current economic context, investing in frontline employee experience has become an imperative rather than a choice for retailers. Our panel echoed this belief and they highlighted reasons why retailers should start investing in the employee experience sooner than later:
Just like investments in e-commerce and supply chains have become non-negotiable, investing in frontline workers is similarly crucial for a superior customer experience.
In a challenging economic context, retailers must prioritize their employees' experience to increase efficiency, reduce turnover, enhance customer loyalty, and ultimately, improve their bottom line.
The panel highlighted that successful strategies involve the thoughtful use of technology, excellent execution, and a people-centric approach.
The right combination of technology, execution, and a people-centric approach can greatly improve the frontline employee experience. Whether the retailer is a luxury or budget brand, these three components stand out as winning strategies in today’s retail landscape.
Frontline employee experience not only plays a crucial role in employee retention but also directly impacts customer satisfaction, brand loyalty, and ultimately, the retailer's bottom line.
In the face of turnover issues and a tight labor market, investing in frontline employee experience can result in lower overall employee and replacement costs, less brand attrition, and an increase in customer lifetime values. It's a preventative measure that is easier and more cost-effective to implement upfront than having to repair the damages down the line.
Strategies involving thoughtful use of technology, focusing on execution, and implementing a people-centric approach have emerged as winning practices, driving better frontline employee experiences. However, there is no one-size-fits-all solution.
Every retailer, big or small, luxury or budget, must start the conversation internally. This conversation involves engaging with frontline teams to gain a first-hand understanding of what works and what doesn’t within the unique context of their operations.
By fostering an open dialogue and establishing feedback loops, retailers can create an environment where frontline staff feel heard and valued. Such an environment, powered by continuous improvement and learning, is where exceptional customer experiences are born.
As we look forward, it's evident that the frontline employee experience is not a passing trend but a fundamental aspect of the evolving retail landscape. The retailers that recognize this truth and act upon it, will be the ones to thrive in the coming years.
To stay competitive in today’s dynamic market, it's time for retailers to put the frontline employee experience front and center.
YOOBIC's Frontline Employee Experience Platform helps retail associates and retail leaders at 350+ retailers including Mattress Firm, Aeropostale, and Gamestop work smarter, communicate better, and learn faster. If you'd like to explore how YOOBIC can help you put the webinar insights into action, get in touch with one of our experts!
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