ACCORDING TO EXPERTS, the COVID19 pandemic has led to a massive disruption in the global supply chain, which shows no signs of easing anytime soon.
This supply chain crisis results from factors such as changes in consumer demand, shifts to online shopping due to lockdowns, factory closures, shipping delays, raw material shortages, to name a few.
With economists predicting that the current conditions won’t improve until 2023, here are a few ways that businesses can navigate supply chain issues in the new year.
Moving Excess Stock:
Geotargeted Ads: Having the ability to target potential customers according to their proximity to local stores could be a powerful way to let nearby patrons know that their favorite products are in stock.
Mobile Wallet Coupons: This allows businesses to create various promotions or coupons and send them directly to a customer’s mobile wallet in return, giving them a nudge or encouraging them to purchase from your store next time they’re looking to make a purchase. Once the coupon has been added to the customer’s wallet, the business can share updates about it through notifications.
Dealing With Limited Stock:
Take control of stock levels: Research shows that 43% of retailers believe better stock level visibility would help serve customers and increase the overall customer experience. You can implement an effective stocktake system to keep track of stock accurately.
Digital transformation: As many countries begin to move away from lockdowns and restrictions, bricks and mortar retailers are starting to recover; however, foot traffic is still not where it used to be pre-pandemic. Many businesses are benefiting from moving online to supplement income lost due to lower than average levels of in-store shopping.
Source locally: It could be a valuable exercise to source alternative products or components and materials locally instead of relying on existing shipping routes. This will vary for different businesses and depend on where they currently hold inventory and are presently sourced or manufactured. This will help companies determine their options and perhaps uncover even better solutions.
Network: Speak to other retailers who might be experiencing similar things to your business. Not only is it essential to have a strong support network around during challenging times but keeping your finger on the pulse and staying informed will help with decision making and forecasting. These networks may also be beneficial for sourcing new products or stock.
As supply-chain disruptions persist, volatility and uncertainty remain for the foreseeable future. However, retailers can grab the opportunity by the horns and address disruptions head-on. This will help in the short term and, if executed properly, could also help build resilience against future disruptions.
Mobeo’s suite of solutions can be customized to fit your individual business needs while driving traffic locally to your product or store. In addition, we offer the ability for businesses to create scalable, personalized digital offerings that are seamlessly added to shoppers’ mobile wallets, allowing for online-to-offline conversions in-store.
Talk to us today about how we can help boost your digital footprint.
The past two years have pushed retailers to their limits, with many unfortunately not surviving. This has also created a push towards switching to online shopping in an increasingly crowded marketplace. Reading and adapting to quick market conditions have often been the key to retailers surviving the crunch.
There’s a myriad of other elements impacting retails, such as the following:
Staffing issues due to COVID-19: With new variants emerging and rules constantly changing, it’s difficult for businesses to stay ahead of the curve. As infection rates continue to fluctuate, staff often need to be furloughed, creating problems for rostering and shift scheduling.
Expensive deep cleaning: The cost of cleaning is likely to have increased for most retailers, and they fight to keep their stores safe and hygienic to prevent the spread of COVID-19 and protect both staff and customers.
Less foot traffic: Due to lockdowns, stay-at-home orders, and general caution, people are choosing to spend less time in crowded retail locations like shopping malls or busy high streets. Instead, they’re opening for shopping online or limiting shopping to their necessities.
eCommerce: The pandemic and various lockdowns have pushed many businesses to migrate online to survive, creating an environment of intense competition as companies fight for their share of voice. This has also driven up the cost of marketing and ads in a crowded digital marketplace.
Marketing on a budget: Marketing has become a more significant challenge for retailers because of increased online competition and tighter budgets due to lower revenues. Many retailers rely on foot traffic, but there are fewer entry barriers when that’s removed. It puts everyone from independent retailers to major chains and franchises on an even keel.
Privacy changes: Facebook, Apple, and Google are making widespread changes to privacy policies that give consumers greater control over what information is shared with advertisers. This, of course, is a good thing for consumers but makes digital marketing more challenging and less accurate. This leads to increased ad spending with lower revenues.
Supply chain issues: Keeping an accurate gauge on sales and demand is crucial for planning stock orders and maintaining stock levels. This balancing act can be challenging because retailers have enough stock and don’t miss significant trends without over-purchasing too much inventory. Additionally, the timing of orders is essential as delivery times are constantly changing due to disruptions caused by the COVID-19 pandemic.
With so many new and emerging challenges being faced by retailers going into 2022, it’s hard to see an end in sight. However, business owners should focus on customer loyalty, providing a delightful customer experience, and get creative with ways to connect with their audience.
It’s predicted that the next big thing in marketing for 2022 will be a focus on social selling, which is a great place for retailers to start targeting.
Social selling has many benefits for brick and mortar businesses, including helping you reach new audiences, boost your search rankings and online traffic, and help establish your business in your local community.
To support your local marketing efforts, Mobeo drives online traffic in-store with our suite of solutions, which can be customized to fit your individual business needs.
Talk to us today about how we can help boost your digital footprint.
The art of increasing the number of people who visit your store, whether physically or online, into paying customers is called “conversion rate optimization.”
Your conversion rate is calculated as the percentage of purchases compared to the total number of people who came into your store on a specific day.
There’s a few different tips and tricks for how to improve the conversion rate for your store:
Upselling and add-ons: Selling products in a package or complete solution rather than a single SKU. The profit margin generally comes from the second product sold because marketing expenses and fixed costs eat away the margin from the first product. Also, at the point of checkout, either the counter or at the website checkout, provide a range of commonly purchased items as impulse purchases. Another principle of retail merchandising is to place one main product with two companion products next to it, making it easier to upsell.
Staff Scheduling: The best way to schedule staff shifts is around the peaks in shopping behavior throughout the day. This helps ensure that customers receive the proper attention during these busier periods. Additionally, staff deployment to serve customers instead of tending to routines like stocking shelves or pricing is equally important. Finally, staff must be available to shoppers to encourage sales and improve conversion rates.
Staff Development & Training: Helpful sales associates who listen to customers and make recommendations can significantly boost conversions. Effectively training employees to help a shopper explore product options, ask about concerns and make helpful recommendations pays dividends. It’s always a great idea to create a collaborative environment by holding regular staff meetings to get everyone involved and on the same page. Incorporating weekly or monthly sales targets with incentives is a great way to boost morale and get staff excited. Employees are the most effective at upselling because they are on the ground, talking to customers, building trust, and making recommendations to the customer based on their needs.
Keep it moving: Reducing lengthy queues is vital because sometimes customers will avoid stores with long lines because they perceive the wait time will be too long. Unfortunately, long wait times often harm the customer experience. You can overcome this hurdle by placing registers at the back of the store or having multiple checkout counters so that there are numerous shorter lines instead of one long line. An alternative to this is ditching POS all together by going mobile.
Plan the layout: There’s proven consumer psychology at play when a customer steps into a store. These insights can be bolstered by clever retail merchandising to improve conversion rates. For example, your store’s first 5-15 feet is the “decompression zone,” whereby the customer soaks in the store environment and decides whether to continue their journey. Additionally, studies have shown that people tend to turn to whichever side they tend to drive on when they walk into a store. For example, people in the US, you’re more than 90% likely to turn right when you enter a store, whereas people in Australia, the UK, or New Zealand turn left. This means the direction that customers turn towards is your “power wall,” where you should display high-margin goods and ensure it’s well-stocked, clean, comprehensive, and easily navigated. You should also aim to remove excess merchandise from the store by having just one size of each product on the floor to keep it from looking cluttered.
As a note, if you’re starting conversion rate is truly abysmal (think 15% or lower), you should check your marketing. You may be mis-marketing your store, bringing in shoppers expecting something completely different than what you offer.
With these tips and tricks in mind, you should rethink your marketing and communications if your starting conversion rate is 15% or lower.
Mobeo provides a powerful way to utilize hyper-local ads to drive traffic in-store and pick your products off the shelves; talk to us today.
There’s mounting evidence that wholesale remains more profitable regardless of the mass shift towards the direct-to-consumer model due to Covid.
It’s been found that wholesale provides greater control, access to data, a higher revenue per item sold, and total gross margin when compared to similar businesses that utilize a DTC model. This can be further demonstrated when comparing these businesses’ EBIT (earnings before interest and taxes).
Contributing Factors:
Increasing competition – as more businesses migrate to the virtual space, more noise is created as more businesses bid for a share of voice.
Privacy – The inception of GDPR and CCPA regulations has limited the capacity for businesses to communicate unsolicited messages to potential customers.
Ad blockers – due to the noise created by the increasing competition and bombardment of ads at various audiences, installing ad blockers have become more commonplace, making it harder for DTC brands to be seen.
Returns and free shipping: e-Commerce spent its early years highlighting widespread “30-day return policies” and “free shipping,” which is taking a toll on DTC margins.
The rising cost of ads – with more DTC competitors in-mark than ever before, the cost-per-click is skyrocketing. This can eat into the merchant’s profit margin or even exclude them entirely if their user acquisition cost is too high.
Although DTC profitability benefits from reduced rent and labor costs, other expenses add up over time. For example, fulfillment, logistics, heavier marketing, technology, and high returns.
Ultimately, both DTC and wholesale have pros and cons, so it’s up to the brand to decide which model is best for their business.
Why are brands attracted to DTC in the first place?
The COVID-19 pandemic and subsequent lockdowns have created an environment of comfort and necessity around online shopping. People worldwide have adapted to “stay at home” orders that require many purchases to be made online. Even as the world starts to reopen, some of that online shopping behavior will remain.
Additionally, DTC provides companies greater control over their brand, customer relationships, sales channels, and fulfillment.
When does DTC make sense:
While wholesale has a clear edge over DTC when comparing EBIT most of the time, there are some situations where DTC makes sense. However, this often depends on the product.
To determine whether DTC suits a brand, two questions need to be answered:
Can we accurately target the right customers?
Are these customers happy to shop online and from a single-brand source, or would they prefer to shop in-store where there’s a variety of brands available?
If both of these questions are yes, it may be worth exploring a DTC model.
However, keep in mind that, based on data, only brands who also sell their products via bricks-and-mortar stores do well in DTC.
Support for Wholesale brands:
Talk to us today if you’re looking for a powerful way to utilize hyper-local ads to drive traffic in-store and pick your products off the shelves.
