UK retail industry fire test
The rise in online shopping coupled with a global pandemic is making the retail industry difficult, especially for the self-employed. Within a week, Boohoo added 772 new clothes to their site. How does an independent company compete with this production? The good news is that their consumer experience isn’t perfect.
Not everyone wants to flip through pages and pages of clothing to find what they’re looking for. While digital retailers like Boohoo and ASOS can’t be fought headlong in the quantity of products, their business model allows another type of retailer to flourish – the retailers who do the customers’ work for them.
Whether it’s technological innovations, sustainability choices, high-quality products, or just smaller, more streamlined web pages, SME retailers can set themselves apart from their giant competitors and offer consumers something different. .
Improve the selection process
Digital retailers are currently in a desperate race to see who can shorten the selection process through various means, the main one being the Custom Wardrobe which suggests clothes you might like based on your previous choices. Zalando employs an impressive 600 people just to develop the artificial intelligence technology that offers these personalized suggestions.
And for the most part, it works. Zalando reports that his outfit recommendations result in 40% larger cart sizes and higher conversion rates. That said, the technology is still far from perfect. Zalando’s algorithm requires data from its customers before it can start making recommendations, so first-time visitors are greeted with the same intimidating mass of options as before.
Unless you hire 601 AI experts, independent retailers have no hope of competing in the same area of ââalgorithm development, but luckily they have their own set of advantages. By the very nature of being an independent retailer, product selection is of course much simpler. The limited number of products per page allows for a totally different customer experience.
Rather than spending time browsing advanced search features to filter choices or absentmindedly scrolling through pages to the max, users are more likely to be alert and attentive, looking at each of the products as they scroll. Retailers can amplify this by using higher resolution, larger images with fewer items per row to allow for more detailed inspection.
With consistently high product quality, consumers can enjoy a much higher âsuccess rateâ than with e-commerce giants, an important point in favor of SME retailers. But it’s still not personalized. The real question is whether or not retailers can deliver smart, personalized suggestions without AI and fancy algorithms.
Perhaps some retailers could partner with platforms like Pinterest that record users’ visual tastes and recommend new images based on past likes. Or, more realistically, retailers could purposefully curate outfits for seasons, events, weather types, or recent trends. Ultimately, what a consumer expects from an independent retailer is sophistication, selectivity, good taste – quality rather than quantity – and it is this characteristic that these independent retailers must exhibit. .
Beyond clothes – brand loyalty
Another good news for independent retailers is that they can cash a check that e-giants are struggling to master: brand loyalty. If Zalando successfully recommends an outfit that a user likes, the user will be impressed with the platform but will still recognize that the recommendation was AI generated.
The user might be just as likely to visit ASOS and check out their AI’s recommendations. A consumer who likes an outfit curated by an independent retailer, on the other hand, will attribute that âgood tasteâ directly to the retailer himself. The consumer will establish a strong and positive connection with the brand, and is likely to subscribe to a newsletter or to come back to the site for future purchases.
âBrand loyalty is a strange term to use in a capitalist society, but it really is the intersection between commercial retail and human and social relationships. Small businesses are more human because they are run and managed by a small number of people whose personalities are infused within the company.
Large companies are becoming amorphous entities, platforms that provide a service without any real human contact. âBrand loyalty should really be ‘brand appreciation’, and it’s something that successful SME retailers are actively benefiting from.
Buzzword of the Century – Sustainability
On the tip of the tongue of every business and every politician right now, sustainability only becomes more relevant in 2021. A 2019 Forbes report found that Gen Z is willing to spend 10% additional for products with sustainability references. Given that this demographic will soon be on the verge of entering the workforce, it is safe to say that there is a significant place in the market for retailers focused on sustainability.
According to Koreti, âWe may only see the beginning of the sustainability movement. As the young, socially active generation matures, sustainability may be the most important factor in their purchasing decisions. This fact alone will have a huge impact on the retail industry.
Sourcing from high-quality, sustainable materials can easily become a brand image that appeals to consumers, especially when compared to the utterly unsustainable branding of most of the retail giants. Of course, any retailer bragging about sustainability claims should be able to back them up with hard facts, but filling that niche in the retail market ensures viability against the myriad of businesses (usually more. large) which, from an ecological point of view, fail.
The retail industry, like many older industries, is struggling to adjust to this new era. The pandemic is difficult enough to manage, but successfully breaking into the online shopping scene and gaining visibility is incredibly difficult without time, diligence, and expertise.
Many would say the retail landscape looks grim at the moment, but in reality there is great potential for independent retailers beyond the pandemic. Those who survive next year will need to forge lasting relationships with their customers to avoid losing business to the convenience e-commerce giants, but those who succeed are in a strong position to be successful in the years to come. .