Retailers prepared to change format, not workforce

Employers moving toward specialized store formats should make sure they get specialized employees.

While physical stores will continue to have an important role in the retail of the future, how these stores will look will change drastically. According to research from Avanade and EKN Research, stores are expected to shift to a theme-based approach by 2020. This shift will require the advancement of in-store technologies, but many of the retailers surveyed seemed blind to training in the workforce that this shift will require.

Of those surveyed, 60% said a theme-based store will transform the focus of traditional stores by 2020, with 56% expecting stores to perform as online fulfillment centers. What will impact this evolution? Respondents identified changing customer expectations, continued negative same-store sales and the growth of digital channels. 

However, it seems many retailers are not preparing their workforce for the changes.

"Retailers must rethink store activities and seek technologies that improve the customer experience and enhance their workforce," said Barry Givens, retail solutions lead at Avanade. "Fifty-two percent of retailers plan to use augmented reality and robotics in their stores in the next one to two years, and it's important to understand the impact of those technologies on the workforce. Digital tools that help train staff and provide personalized employee experiences are just as important as those that engage the customer."

Based on the survey, Avanade recommends some preparations retailers should take, including enhancing the store workforce, providing a true digital workplace and agile training, and adopting automation at the store level.

However, just because retailers want to make digital advancements does not mean customers are on board. In fact, Givens notes that we often see retailers trying to create an in-store experience that gives them insight on shoppers that can be tracked by mobile and web presence: beacons, interactive displays, smart tags for products. All of these things help stores analyze traffic and identify customers.

Customers, on the other hand, are looking for friendliness, speed of checkout and product information. 

"Technologies can help with all of those things—even the friendliness. Except for some specialized product categories, I don’t think that customers are looking for technology in the store," Givens told FierceRetail. "The Accenture (Avanade’s parent company) Global Consumer Pulse research is showing this: Consumers want a human connection. In-store technologies that get in the way of that connection are a big miss." 

Givens does believe some technologies marry both experiences, such as clienteling solutions that help store associates provide customer recognition. Another example is digital signage, which can deliver information and product discovery to customers.

The survey pointed out several challenges employers are having with employee management. Aside from the cost of training, Givens notes that employers are increasingly concerned about labor regulations. In the case of training, they need to account for compensating employees for training time. 

"The survey was interesting on this point because retailers told us that they believed that they would be moving to more experiential types of stores but they didn’t see a change to the type of work that their employees would do. So if there’s another challenge with training, it’s that retailers haven’t recognized the need to increase the amount of training that they’re doing," Givens said. 

Givens believes that employers moving toward specialized store formats should make sure they get specialized employees. Another move for employers is to adopt technologies that enable distributed and mobile training, and that can track employee time spent on that training. This allows training solutions that can track time spent outside of shift hours, in small increments, which can be used by employees based on policy and budget. 

"And 15 minutes of training is a great way for an employee to earn extra money on a day off," Givens added. 

In the survey, retailers indicated they would rely on more temporary labor in the future. If a manager brought in an outside vendor to perform inventory every month, that could be a tremendous savings in terms of cost and training for specialized tasks. 

Looking forward, Givens says that technology will be a larger part of operations. For some customers, it will be obvious when shopping in-store; for others, it will be completely invisible what the retailer is doing behind the scenes. 

"The most surprising thing to me about this survey (still) is the divided thinking that our respondents had around where store formats were going and how work would change. There was such a strong conviction that store formats would change in the near term and, it seemed, an equally strong belief that the work employees would be doing would stay the same," Givens said.