Retail Business Operations Post Covid-19

The challenges that are facing the business world, caused by the avalanche of Covid-19 cases across the globe will ripple on for some time. The consensus is that the world will be a very different place when we come out of the other side, hopefully for the better.

My focus is the Retail, Travel and Transport world for Microsoft, the sectors which have arguably been the hardest hit by the Covid-19 lockdown. When we go back to a level of normality, what world will retailers open their door to? How many people are going to want to go out and book a holiday? Will the rise of eCommerce over this period see a boom in the logistics space?

At this time, it will be difficult to predict the outcome of this evolving world, but we do know certain factors are likely:

Consumer Spending & Confidence

The 50 year historical trend for consumer spending is unabating in the UK, largely because the figures do not reflect inflation of the pound. However, there are two significant dips in this consistent growth; firstly, a reduction in consumer spending can be seen in the early 1990s, aligned to the recession during John Major’s leadership. The second, much more significant dip was seen during the Financial Crisis of 2008.

If we consider how consumer confidence aligns to consumer spending, there is a clear fall in confidence during a recession and when there is a reduction in consumer spending, as you would expect.

Unfortunately, we can see that consumer confidence has plummeted in March 2020, already dropping to levels only seen during the two recessions mentioned above. We can assume that we are heading for a difficult period for the UK and global economies.

It is therefore clear that every consumer pound spent over the next few years will be of greater value than most other periods in our history. Those organisations that focus on taking market share will be the retailers, travel companies or transportation firms that will come out of the pending recession intact.

An Accenture study has stated that 91% of consumers are more likely to shop with brands who recognise, remember, and provide relevant offers and recommendations. It is therefore more important than ever to understand the historical trends of your customer base, what they have purchased and when and potentially what they have browsed on your website. However, relevant customer data doesn’t stop there, if you look hard enough, data points are everywhere: on social media, from beacons in store, from activity with your competitors.

It’s not only important to understand the historical behaviour of the consumer, but also grasping the changing behaviour of your customer base to be able to predict the future. This data is only relevant and powerful if the insight is actionable, if it enables your business to make adjustments to your go to market, or specific targeting of customer segments.

Customer Experience

The second an organisation wins a customer; the fight commences to maintain that customer’s loyalty going forward, encouraging the customer to return to your brand time after time.

Customer loyalty isn’t a new concept, with loyalty programs having been one of the big trends of the previous 20+ years. However, over the Covid-19 lockdown, we have seen an acceleration of the move towards multi-channel commerce. We will expect the bricks and mortar retailers to be the hardest hit and those with a stronger eCommerce presence will likely be in a stronger position as we come out the other side. The challenge retailers and companies operating in travel and hospitality will find is enabling multi-channel, seamless and consistent experiences across their customer facing operations. As a consumer, I want to be able to shop online, collecting and spending my loyalty points or picking up my order from my local store.

One of the key issues to come out of the lockdown period has been the fragility and lack of scale provided by contact centres. This one issue will be the making or breaking of many famous brands, particularly in the travel industry, as customers will have long memories about how long it took to get support for their cancelled holiday or how long it took to get their money back.

The three biggest issues faced by contact centres also relates to having a disconnected experience by both contact centre employees and the customer. So few large organisations have been able to stand up multi-channel contact centre support, we know that an operative can handle up to nine times more queries through a live chat facility than a physical phone call. However, even live chat requires a human interaction and the lockdown has exposed those contact centres requiring their staff to attend the workplace due to a largely on premise architecture, not enabling their employees to work remotely.

The final challenge realised in many contact centres is the volume of calls coming in from customers needing support. It is fair to say that recent events will have caused a massive spike in activity, but organisations need to understand that spikes can happen for numerous reasons and the way that they deal with a spike in call centre activity will be reflected in future customer loyalty. Intelligent virtual agents need to become the starting point for a connected customer journey, enabling simple queries to be resolved without human interaction, as well as confirming identity and routing queries to the most appropriate area within an overburdened contact centre. Taking away the simple repetitive tasks will enable a much higher volume of calls to be taken and cases resolved.

Productive Home Working

There is a revolution happening around home working. For the technology industry this isn’t a new thing, working from home is quite normal. However, the lockdown has required so many more people to login remotely and use conference call facilities such as Microsoft Teams to go about their daily work.

The thing that has come as a massive surprise to many is the level of productivity achieved working in this environment, it has been phenomenal. Without distractions of travelling, elongated tea breaks or trying to think through your colleague’s conversations; working from home has demonstrated how much more can be achieved.

This trend will have flagged key issues that need to be considered before this can become the normal for most organisations:

Cloud – although recent years has seen the explosion of cloud software being used across organisations, the lockdown has exposed the reality that legacy on premise solutions are still providing business critical roles within the workplace.

Connectivity – two or three people working in the same home has exposed the challenges of bandwidth availability for many people. This topic has been high on the agenda for the UK government for many years; to truly enable this working style, internet speeds will have to be a consideration across the country.

Automation – a benefit of being in the office is being able to access multiple systems, to make multiple updates, across both cloud and on premise systems. This can be a challenge for the home worker and needs consideration. The use of robotic process automation may be critical, enabling organisations to take a single input and to make unattended updates to multiple systems.

Safe eCommerce

The eCommerce market had seemed relatively saturated prior to the Covid-19 crisis. However, being in lockdown with many businesses not able to trade in their normal way, has exposed some innovative ways of using web platforms.

An example of innovation for retailers is the rise of virtual sales appointments; whether this is for a consultation, a car dealership doing a remote inspection of a car before booking in a repair or kitchen design companies visualising the site. When you consider how many purchases you have made in  bricks and mortar stores that have required more than one visit, where you have had to go home to review the details before travelling miles back to the store. It seems like madness, when a remote appointment could be organised, the items added to your cart in real time and the transaction processed without you leaving the home.

At the heart of this innovation as with any other mentioned in this article is the need to have a connected data platform at the heart of your solutions; if we offered a disconnected experience, productivity will be lost and the customer will go to a company that can provide a more seamless experience.

With the inevitable increase in eCommerce sales, there will inevitably be an increase in fraudulent activity. An estimation prior to the Covid-19 outbreak was that the world would see an economic impact of $250bn per year due to online fraud. Therefore, using intelligent fraud protection networks is incredibly important to reduce the impact of fraudulent transactions, whilst ensuring that real transactions are not incorrectly blocked due to an overzealous fraud platform. Since utilising the Dynamics 365 Fraud Protection solution, Microsoft have seen an increase in eCommerce revenues of approximately 9%, the majority of which has come from reducing false negatives.

Unnecessary Travel

The evidence of our natural environment fighting back against pollution has been posted everywhere on social media: dolphins in Venice, clear views of the Himalayas and no planes in the skies.

Sustainability of organisations in retail, travel and transport has long been seen as a key marker for success in the future, but the lockdown has enabled all of us in business to see some immediate impacts of us doing things differently and many of us still doing our jobs effectively without travelling.

I discussed earlier how working from home has become a normality, which is easy for those of us who are desk based workers, but what if you are a specialist engineer or a safety inspector? The lockdown has accelerated the demand for remote working tools; video conferencing tools as discussed above are an example, but what if you need to tackle complex problems without being on site? Interest in mixed reality capabilities has been significant over the past few weeks, with many organisations using this technology as a temporary fix whilst their engineers are unable to attend sites.

However, when the lockdown is over and we go back to a semblance of normality, why would we go back to in-person activities as a standard? There is quite often little need to take the train into London, the drive to Milton Keynes or the flight to Aberdeen. The business world could look at this period as an opportunity to prove that tools like Dynamics 365 Remote Assist enable their business to operate with much lower levels of business travel; if the results are positive, costs can be reduced, the environment protected and the work/life balance of employees can be improved.

The current business environment is complex and unpredictable, the successful businesses of the future will need to prioritise business and technological agility in their planning. The IT strategies of the future will need to have a focus on speed, ease and consistency; a business will need to pivot from operational excellence to operational “doing enough” at the drop of a hat.

To read Alysa Taylor’s (Microsoft Corporate Vice President – Business Applications & Industry)  blog on the way Microsoft is supporting businesses impacted by Covid-19, visit https://cloudblogs.microsoft.com/dynamics365/bdm/2020/03/26/resources-and-support-for-our-global-customers-impacted-by-covid-19/