The Modern Store: The Key To Convenience For Tomorrow's Shopper Here Today
By Spencer Kieboom, Pollen Returns
The term digital nomads often comes up as a significant transformation in human behavior relating to hybrid work, lifestyle, travel, and the growth of a gig economy, magnifying the strategy surrounding retail’s evolution of capturing consumers and their buying behavior.
As a result of the pandemic accelerating digital commerce channels, consumers are comfortable and appreciative of online shopping options, which has brought the modern store of the future, consequently at the pinnacle of importance for retailers with digital-facing channels.
Current Demands Of Digital Nomads
With the permanent integration of tomorrow’s consumers here today, it has become imperative to identify the consumers’ entire journey, understanding how exceptional experiences can enhance further sales, improve loyalty and spur growth. Meeting the demands of customers is no small task and is being heavily scrutinized with maintaining profits at the top of the list of priorities after the spike of recent growth through hyper-fast delivery options becoming the norm. With same-day delivery at the forefront, the hybrid warehouse model is the way to go, but it brings about its set of new challenges and has magnified inventory carry.
Thus, the need to reassess the reverse side of things, returns, is more important than ever – fast out mixed with slow back, won’t cut it for the retailer of the future.
Enhanced easy-to-access experiences and services have, and always will be, a sure way to win over consumers. Digital nomads have specific needs and expectations when making a purchase - opting for quality, price, environmental commitments, and experience all are at the forefront. The catalyst of selling products and exhibiting customer loyalty is, in other words, that today’s consumer requires the ultimate cocktail of personalization.
Overcoming The Returns Challenge
The challenge to create the “ultimate” brand loyalty with growth whilst keeping costs low for profits, returns present a huge opportunity to capitalize on. Retailers are losing billions in products trying to surmount the complexities of managing a reverse supply chain due to its lack of needing to be addressed in the past, but it’s time because online shopping is here to stay which means a “return policy” is no longer sufficient for what now represents a healthy portion of their inventory.
The comfort of shopping with our fingertips has been made seamless but leaves the physicality of pushing or clicking buttons, lacking the tangible touch of items inevitably making online returns higher - a recent study shows an average of 30% of all products purchased online are returned, forcing the hand to begin addressing what makes up a third of their existing inventory. Faster recovery allows retail to begin leveraging this inventory with a huge opportunity to capitalize on enhancing the customer experience, 88% of shoppers are checking a returns policy before finalizing a purchase. Consumers want transparency from who they buy from, the same way consumers want to know delivery times, workplace diversity, or sustainable efforts – transparency matters.
With excess inventory problems hitting headlines daily, it is obvious retailers can no longer neglect the last bit of the consumer journey but master the complexity of the reverse supply chain and address the outdated policies put in place at the emergence of eCommerce.
Encouraging Customer Loyalty
It started with Zappos in 2002 when the decision to offer “free online returns” with the entire industry, initially thinking it was crazy. Flash forward 20 years and the same policies are being utilized. In comparison, it’s like renovating a dated home from top to bottom but leaving the bathroom that has a matching green toilet and tile decor.
The future must be focused on speed, meaning faster recovery of the returned product to be reinjected. As a by-product, better experiences for the consumer are created with new ways to market with incentivization that align with company initiatives: membership signups, shopping cart minimums, exchanges, buy now options, sustainable offerings, and more.
With earnings coming out and excess inventory being in the spotlight, motion to solve this problem has ensued to minimize the waste and stop the bleeding. Temporary fixes like major markdowns or waiting on the holiday season are short fixes, a band-aid to an emerging new wound that will continue to fester.
Returns have the power to play an instrumental role in solving the inventory issues at hand with a massive upside to meet the demands of today’s consumer, the digital nomad. What can confidently be agreed upon is if the reverse supply chain remains neglected and the current process of “fast out – slow back” continues - expect to see headlines, like the one Gap recently released, for years to come.
About The Author
Spencer Kieboom is the Founder & CEO of Pollen Returns.