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In April of last year, businesses across the country were in the throes of closing their physical stores, facing uncertainty around COVID-19's impact on sales and profitability. Now, with vaccine distribution rolling out across the nation, many states are allowing stores to return to a full capacity. As of April 2021, the U.S. has administered 150 million COVID-19 vaccine doses, signaling a retail recovery.
One year later, standard messaging around COVID-19 prevention measures – such as social distancing and sanitation processes – is no longer enough. Shoppers are looking for permanent changes in a company's practices. As retailers prepare stores for the rest of the year and welcome eager shoppers, technology should be at the forefront of their plans.
Even before the pandemic, waiting in line to checkout was one of the largest pain points for physical retail. Now, consumers are opting for more seamless and faster payment methods. As a result, credit cards and mobile devices have become a common sanitary, no-touch payment option for consumers.
In response, retailers needed to modernize their POS even further to make it fully contactless. Consider the friction in this scenario: a consumer inserts their card or uses tap-and-pay, but then still has to use a pin pad to complete the transaction. The full experience is simply not contactless. Retailers must update their processes as quickly as consumers are changing behavior.
Regarding payments trends, Forrester analyst Lily Varon recently noted in Retail Dive that, "evolution from both the merchant and customer side picked up pace to evolve with changing market conditions."
In fact, a report by FIS projects that by 2024, cash will account for less than 10% of in-store payments in the U.S. Any retailer that is not catering to consumers' new needs for contactless options at the POS will be at a competitive disadvantage.
Imagine setting up a contactless POS journey, but then, at the very last step, the shopper is handed a paper receipt, creating unnecessary friction. Electronic receipts in the form of email or a mobile message can streamline the entire checkout processes. In addition, electronic receipts can provide a touchpoint to drive loyalty. For example, a receipt can include a promotion, or an opt-in confirmation to drive continued email communications.
Transitioning from paper to electronic receipts turns the point of purchase into an omnichannel experience, extending a consumer's interaction beyond the physical store.
Similar to electronic receipts, mobile devices should be utilized as an engagement tool, as they are a direct link to customers. With vaccine distribution underway, more shoppers are returning to physical stores, but are limiting their time spent browsing - whether that's locating an item on the shelf, trying on clothes or asking for an associate's assistance.
With a mobile customer platform, retailers can service their customers from afar. For example, QR codes can promptly contactless checkout, and a mobile app can provide the functionality to locate a nearby store, order ahead or create shopping lists.
Advanced mobile solutions can also inform shoppers about new promotions, coupons or loyalty actions directly on their smartphone. This strengthens long-term loyalty for a brand and offers a personalized shopping experience.
As the population continues to become vaccinated, brick-and-mortar stores should be focused on making shoppers comfortable in a physical space, as well as providing them the tools to self-serve with speed and efficiency.
Our OmniPOS and Mobile Consumer Assistant solutions can help you meet the demands of the shoppers of both today and tomorrow.
For consumers, pop-up stores are seen as exciting and exclusive. If shoppers live far away from a brand’s physical store, pop-ups can be an opportunity to experience the brand and interact with it in a new way outside of the online shop.
The benefits for retailers are also tenfold.
Pop-up retail is a low-risk way of testing out new markets or products. The reduced overhead for rent, utilities and inventory allows retailers to further reach their audience with minimal commitment.
Major, established brands such as Gucci, as well as those that rely on seasonal sales like Spirit Halloween have embraced pop-up stores. Pop-ups have allowed brands to take advantage of vacant retail space and transform the space into an interactive experience, selling limited-edition or a select line of products.
Overhead on pop-up stores may be low, but retailers must ensure they have the right back-end technology to seamlessly conduct their operations before they can take the leap.
Running a pop-up store in a short-term space means that a retailer will not have the hardware equipment they do in their permanent stores. A lack of barcode scanners, receipt printers and cash registers can add a level of difficulty when it comes to managing checkout and payments.
Luckily, mobile retail concepts can easily be deployed. Omnichannel POS solutions can manage checkout processes from anywhere.
For example, employees can complete transactions via a handheld device. In addition, consumers can checkout and pay via their smartphones.
We’ve touched on headless commerce in our blogs before; it’s a critical tool for retailers looking to manage the shopper journey across multiple touchpoints. An open platform also allows retailers to react quickly to evolving market needs and adjust as required.
For example, pop-up stores are notorious for offering limited-time products and deals. A retailer needs to be able to quickly introduce these new items or promotions.
As items sell out, a real-time view of inventory can help retailers set expectations with expectant consumers. And with their phones unlocked and in-hand, shoppers can also manage promotions and access their loyalty information swiftly and with ease.
Interested in increasing foot traffic and consumer engagement in a low-cost, low-risk way? It almost sounds too good to be true.
Before including pop-up stores to your retail strategy this year, first guarantee that your physical operations can be run from anywhere – from POS to inventory management. GK Software is here to help you get started.
According to preliminary figures, its EBITDA reached a level of 18.5 million euros. This is around one and a half times the previous year’s result of 12.3 million euros (up 51 percent). Despite the restrictions on sales caused by the global COVID-19 pandemic, revenue continued to rise to 117.5 million euros, of which 110 million euros was generated by the CLOUD4RETAIL product platform. This raised EBITDA (earnings before interest, taxes, depreciation and amortization) to 18.5 million euros, equivalent to a 15.7 percent margin on revenue. This is an impressive display of the company’s success in achieving the goals of its efficiency and profitability improvement program.
Despite the restrictions, GK Software was able to acquire eleven new clients on four continents for its core solutions in the 2020 fiscal year. Additionally, three other existing clients decided to switch to CLOUD4RETAIL - OmniPOS in the past year. For the first time, a total of four customers are using the SaaS offering of our core solution CLOUD4RETAIL. Deutsche Fiskal was also extremely successful in attracting new clients, with more than 100 clients opting for its cloud solutions.
The most important development in the fiscal year was the conclusion of SaaS contracts with a minimum order volume of roughly 50 million euros, with terms ranging from three to ten years in most cases. In the classic license business, sales of around seven million euros were generated. For the Executive Board, this indicates a shift toward the cloud business, which it expects to account for an increasingly large share in the years to come.
The company’s complete report is due to be published on April 28.
The future of physical stores has been a key topic of discussion long before the pandemic. You’re likely familiar with the phrase “retail apocalypse,” which originated when the steady number of store closures led the industry to believe e-commerce was the future.
And there’s no arguing the unprecedented growth that e-commerce saw as a result of COVID-19. In fact, during the pandemic, 10 years of e-commerce growth happened in just 90 days.
But does this mean the end for physical retail? Not at all - in fact, it’s quite the opposite. The pandemic only underscored the importance of stores, as retailers and restaurants embraced new services such as curbside pickup, Buy Online, Pick Up in Store (BOPIS) and relied on stores for order fulfillment.
These changes underscore the fact that physical store locations still matter, and the best-performing retailers are the ones that innovate the fastest. To ensure continued success, retailers must have the technology infrastructure that can support continued innovation. This encompasses three areas: architecture, equipment and function.
Traditional brick-and-mortar retailers have learned the importance of an online presence. However, they’re also learning that it’s important for their online efforts to work hand-in-hand with their strategies for physical stores.
A centralized architecture can help retailers achieve holistic omnichannel commerce.
Centralized architecture allows shoppers to experience a unified experience across all channels and touchpoints. BOPIS and curbside services are great examples of seamless experiences; a consumer begins the grocery shopping online – whether through an app or a desktop – but then completes the journey at the store.
There’s a plethora of factors for retailers to consider when migrating to robust and agile architecture. Consistent branding, messaging, personalized messages and promotions, payment options and integration of fuel options are all of equal importance when it comes to better serving customers.
During COVID-19, health and safety took the driver’s seat when it came to technology upgrades. Consumers demanded minimized interactions and touchpoints in-store.
This is where the point of sale can be completely revamped.
A checkout line is a notorious pain point for the physical store. Establishing faster, seamless options for a shopper to complete a purchase and pay are a win-win.
As consumers continue to grow more comfortable using their own devices for checkout and payments, mobile POS solutions enable retailers to provide exceptional customer service anywhere in the store.
Options to order ahead, tap and pay or use a self-serve kiosk can now all provide the same quality, speed and security of a stationary POS. To the industry’s surprise, QR codes have surged in popularity as yet another way customers can engage with a physical store in a safe and contactless manner.
Perhaps the most critical transformation retailers must undertake is the function of their stores.
The traditional store has evolved to be much more than a location for shoppers to browse and buy the items they need.
Local delivery, order ahead, curbside and BOPIS continue to rise in popularity. These fulfillment methods have caused retailers to reevaluate their use of store space. As parking lots have expanded to become part of the store, designated signs and messaging are required to help seamlessly guide consumers through the journey.
Especially for food retailers managing fresh items, utilizing dark stores can ensure efficient fulfillment to shorten delivery times. What’s more, dark stores eliminate the need for pickers to be in physical stores, which can decrease the experience for customers who choose to shop in a traditional brick-and-mortar store.
These fulfillment options will continue in a post-pandemic world, as they’re quick and convenient methods for busy consumers.
Prior to the pandemic, retailers were focused on the importance of experiential retail in their stores. While a return to days before the pandemic is not possible, experiential retail still has the potential to influence the next few years of retail evolution.
At its core, it’s still about a personalized, seamless experience that’s unparalleled to a competitor. And as discussed above, physical stores still play an essential role.
But first, retailers must ensure their architecture, equipment and functions are up to snuff.
GK SPOT is currently being developed as a big data solution that is tailored to the needs of the retail sector on the tried and tested CLOUD4RETAIL platform; it aims to eliminate existing restrictions and tap into new possibilities. The Fiskal Cloud solution was also developed on the CLOUD4RETAIL platform using the latest technologies and it is now handling more than ten million transactions in real time every day. In addition to GK SPOT, GK's innovation offensive also includes the Omnibasket.com open platform, which opens up a unique type of retail enterprise solution for extensions for customers and innovators as well as new omni-channel solutions, for example, for managing orders.
The Management Board at GK Software assumes that GK SPOT will enable the company to further extend the competitive edge that the CLOUD4RETAIL platform already enjoys and create the basis for ongoing, high-value cloud solution services for the retail sector. The company is planning to launch the new solution in the market place in 2021.
The option of free returns is a major value proposition for online shoppers, ultimately delivering a sense of security that increases the likelihood of purchase. What’s more, free returns are now the norm, with 55% of online retailers offering them.
However, returns can be costly for retailers. Processing returns results in additional expenses and logistics, from paying for shipping to managing inventory restocks for an item that may be out of season. With this in mind, retailers must weigh the ratio of returns and compare to expected profit.
With returns now a billion-dollar business, retailers are looking to update processes to keep the cost of returns as low as possible. Average return rates vary by category, but clothing and shoes bought online typically have the highest rates with 30 to 40% returned, according to CNBC.
To reduce their return ratio, many retailers are working to identify the reasons consumers return goods. Let’s explore a few factors, and explore opportunities for decreasing the ratio.
Retailers are often concerned that automated pricing can increase the number of returned items. For example, they believe if an item is viewed as expensive, a shopper might come to regret their purchase.
This is simply not true. Consumers often spend more time evaluating expensive items before buying. Products like a pair of golf clubs or a couch are rarely bought on impulse.
On the other hand, when it comes to affordable products, shoppers might purchase more items with the intention of keeping a few and returning the rest.
For example, we see this occurring when a shopper orders the same shirt in two sizes, with the plan of keeping the one that fits. This is especially common during COVID-19, which has resulted in an increase in online shopping and closed dressing rooms.
If we agree that consumers have already accepted the price of a product before clicking “checkout,” then it is only when the product has been delivered that other factors determine whether it will be returned. For example, a shopper may decide to return an item due to fit or function. Sometimes we simply aren’t sure if we want to keep a pair of pants until we’ve identified whether they work well with the shirts we own.
With this in mind, it’s important to ensure other factors are present on your website so a shopper can make a more informed decision, which ultimately reduces the likelihood of a return. This might include incorporating customer reviews, product images or product descriptions. Sharing a few outfit examples may be just the information a shopper needs to decide whether that pair of pants work with their shirts before they make a purchase.
In the end, it’s clear that price influences the purchase decision, but not the return ratio.
As a result, any retailer will benefit from using dynamic pricing solutions, which evaluate market conditions to display a competitive price. In this way, a shopper is more incentivized to purchase as they receive the best deal.
With dynamic pricing, retailers can ensure that price is never the factor for a return. Dynamic Pricing by GK can streamline pricing for more intelligent, efficient, and successful pricing strategies. Are you ready to learn what GK Software can do for your business?
Retailers are facing increased pressure by major brands like Amazon, Target and Walmart that offer “everyday low prices.” They’re realizing that in order to compete, they need faster, more responsive pricing strategies.
Enter dynamic pricing.
It’s a daunting and intensive process for retailers to keep track of thousands of prices. In addition, they must also determine how best to optimize pricing strategies and execution. An AI-driven, dynamic pricing solution can strategically price items for a unified commerce strategy. It’s key to making real-time, in-store pricing updates, as well as personalized pricing for customers.
Dynamic Pricing is a “mom and pop” shop principle for the digital age. Small, locally run stores often employ a pricing policy based on past experience. For example, offering a discount on bread, fresh produce or other perishable goods close to closing time would help drive profit and limit inventory.
Today, for retailers managing a number of stores, they must similarly consider a variety of factors in their pricing strategy. This includes the supply chain, consumer demand, competitor pricing and products’ relationship to one another. Dynamic pricing helps retailers quickly navigate every factor at scale.
Dynamic pricing enables retailers to react to internal and external factors to quickly and effectively establish optimized prices. For example, retailers can respond to competitor pricing. Nowadays, shoppers conducting comparison pricing is common. This makes price an important factor to a sale. This also means price changes are more frequent. Dynamic pricing can build a revenue growth strategy that not only protects the brand’s value, but also its margins.
Our Dynamic Pricing by GK solution is AI-enabled, allowing retailers to run their omnichannel pricing strategies in real time and at scale. It allows for faster, more accurate pricing optimization based on available customer and market data. With this, retailers can proactively adjust prices for every customer, on every channel.
Dynamic Pricing by GK was recently recognized as a Representative Vendor in Gartner’s 2021 Market Guide for Retail Unified Price, Promotion and Markdown Optimization Applications (Gartner subscription required). You can read more about the designation here.
Watch a short video to see more about Dynamic Pricing by GK, and reach out to us today to learn what the solution can do for your business.
GK Software today announced that it was named a Representative Vendor in the 2021 Gartner Market Guide for Retail Unified Price, Promotion and Markdown Optimization Applications (Gartner subscription required). Gartner’s report notes, “Retail CIOs can use this research to understand why AI-driven, unified price optimization solutions are required to strategically price for unified retail commerce as well as to help them identify providers in this market.”
According to Gartner, “Dynamic pricing algorithms for B2C organizations help maximize revenue from services, experiences and related products by identifying the optimal price, based on real-time supply and demand, promotional cadence, competitors’ pricing and customers’ behavioral profiles. Pricing for services, experiences and related products is dynamic as it leverages availability as a key element to maximize capacity. Done correctly, dynamic pricing can provide value to both an organization and a customer.”
GK was selected as a vendor for its Dynamic Pricing by GK solution, an AI-enabled solution that allows retailers to optimize their omnichannel pricing strategies in real time and at scale, based on the full scope of their available customer and market data. Dynamic Pricing by GK seamlessly integrates with emerging and established technologies that make real-time in-store price updates and personalized pricing a reality. It allows for faster, more accurate pricing optimization by proactively adjusting pricing for every customer, on every channel, based on the unique context of every emerging interaction, in real time.
“It is a daunting and highly intensive process for retailers to keep track of thousands of prices and how best to optimize their pricing strategy and execution,” said Michael Jaszczyk, CEO, GK Software USA. “That’s why dynamic pricing is key to make real-time in-store price updates and personalized pricing a reality. We believe that Dynamic Pricing by GK was recognized by Gartner because the solution allows retailers to support pricing optimization strategies and enable analysis and price-setting automation consistently with every customer, building revenue growth that protects brand value and margins.”
View the Market Guide for Retail Unified Price, Promotion and Markdown Optimization Applications here (Gartner subscription required).
Gartner, Market Guide for Retail Unified Price, Promotion and Markdown Optimization Applications, Robert Hetu, 6 January 2021.
Traditional shopping methods have taken a backseat to online traffic growth as a result of COVID-19. According to Digital Commerce 360, U.S. consumers spent $861.02 billion online in the U.S. in 2020, a 44% increase compared to 2019. Now, there are many ways shoppers engage with retailers beyond associate assistance in the store.
Whether shopping online or in store, many consumers are opting for contactless options. The challenge is that with contactless, delivering exceptional service on each and every touchpoint becomes much more crucial.
The most successful retailers have already embraced the omnichannel journey.
It shouldn’t matter where or how a customer shops, as every touchpoint is as important as the last. In fact, a shopper may even start their journey in one place, like a mobile phone, and complete it in on another, such as in the store or on a desktop.
This blending of shopping touchpoints has become commonplace. New advancements like BOPIS and curbside pickup continue to mix the online and brick-and-mortar experience. As well, existing technology have emerged as contactless options, like the QR code.
Giving consumers the ability to self-navigate online and in store is just as important now as it is to have trained associates in a physical store. Many shoppers today are looking to minimize the number of interactions and the time it takes to complete a sale – whether face to face or through clicks. Retailers must focus on streamlining processes to reduce friction and meet a shopper’s individual needs.
If a shopper knows what products they’re looking for, then finding them quickly and ensuring a fast and easy checkout process is key to guaranteeing their loyalty. For example, in a grocery store, self-checkout lanes or mobile scan and go options can offer a faster payment option.
For online shoppers, retailers should look to cut down on the time it takes between “add to cart” to “checkout.” This can be done by recommending items based on past purchase information. Another way to reduce checkout time is to securely store credit card information for a one-click checkout.
Our solutions are designed to uniquely serve customer needs regardless of shopping channel. As consumer behavior continues to shift toward contactless preferences, ensuring the best quality of service is critical. Reach out to learn how we can help you.
According to Forrester, more than one-third of U.S. online adults want retailers to do more to offer them personalized experiences. In the years after the turn of the millennium, simple algorithms implemented recommendations such as “customers who bought this product, also buy these products,” but over time personalization made its mark in new and innovative ways in online shops, newsletters or apps.
Intelligent systems now interact in real time with every single customer and show suitable products and content in seconds based on shopper click behavior. Through personalization, retailers can display the “right” products, tailored to the preferences of unique shoppers.
Let’s explore five methods for intelligent personalization that will inspire your customers and boost sales:
Take a shopper who puts an item in their basket, but does not purchase the product because it’s not exactly what they had in mind. Implementing product recommendations based on image similarities can help fill this gap by recommending the shopper’s ideal product. For example, AI algorithms can analyze all product images and recognize similar shapes and colors, showing all red long sleeve women’s tops.
Recommendations based on image similarities can also be filtered based on information in the product master data. For example, you can recommend only products from a certain category or certain brand.
Linking product recommendations and price can help you achieve key KPIs. If you want to increase shopping cart value, you can set the corresponding minimum price for product recommendations. For example, you can set product recommendations to be a maximum of 5% cheaper and a maximum of 40% more expensive than the displayed product.
Another way to link recommendations and KPIs might be by increasing sales with a daily deal. In order to encourage as many visitors as possible to use the daily deal, it is best to align it with the preferences of the shoppers. So, if you show the customer an item from their favorite category or a product that is visually similar to the promotion, the chance that they will be interested in purchasing the product is higher than with a more generic deal.
Aligning recommendations with KPIs can also reduce cart abandonment -- 69% of shoppers abandon their carts. After defining a certain time window, or other criteria, an intelligent personalization solution can display a discount or free shipping incentive to encourage a shopper to complete their purchase.
Making customers aware of other items and product categories you sell is essential. Dynamic recommendation boxes allow customers to click on their favorite category to reveal personal items tailored to their preferences. What’s more, this increased interaction with the customer provides the personalization software with additional data for targeted personalization.
Online shoppers are often willing to share their interests and preferences if it helps them receive better recommendations or tailored deals. In fashion retail, customer profiles can include information on clothing style, preferred fit or favorite colors. Information about skin type or eye color can be noted in the beauty segment.
With this additional information applied to a product segment, retailers can further increase the quality of recommendations, increase the satisfaction of customers and ultimately generate more sales.
When online customers are looking for gifts, inspiration can be helpful. Consider a shopper looking for a child’s birthday present. If the shopper is searching for clothing in a certain size, why not provide receive recommendations for toys that correspond to the child's age?
This can be achieved by coupling the clothing size sub-category with the toys sub-category for a certain age group. Or you can use the shopper’s previous purchases to determine the age of the child. Based on the age, you can generate product suggestions in the regular newsletter that "grow" with the age of the child.
With these five strategies, retailers are better able to understand their shoppers on an individual level, providing a higher quality of service. It’s time for personalization to move away from a concept, and toward a proven, successful practice in your business. Are you ready? Reach out to us today.
The Retail Innovators