A vision for 2020: 4 challenges retailers must tackle head-on this year

Posted by Sarah Taylor on Tue, Jan 07, 2020

The tree is down and the wrapping paper’s in the recycling bin; it must be the start of a new year. A new decade, in fact. And while the past 10 years have been testing at times for the retail industry, the turning of the calendar signals a fresh start and a chance to refocus.

This is the most opportune year to change focus, as retail brands seek to face the next 12 months with 2020 vision over their business, finding new opportunities to grow customer sales and loyalty. But what will be the main challenges they must tackle head-on in order to be successful?


Sanderson has put together four key trends that will impact the year ahead, featuring insight from some of our leading industry connections….
1. Customer growth – exploring new recruitment avenues

Attracting new customers is a primary objective for all retailers, but the source of untapped opportunity changes year on year – and 2020 is no exception.

With consumer caution high in the UK, many retail brands will be looking further afield to international expansion opportunities in the year ahead. A Deloitte report into the consumer in 2020 reveals that people"will be more value conscious, seeking low prices and avoiding some discretionary spending. Thus, brands will obtain growth through market share gains simply by latching onto a growing market.”

We’re already seeing an appetite for international expansion in the UK retail sector, as data released by Global-e has revealed a 545% increase in cross-border orders over Black Friday this weekend – including within markets that traditionally don’t mark this calendar event.

While Brexit will of course play a major role in how retailers’ 2020 global growth plans evolve, with the exchange rate and supply chain factors a matter of particular concern, retailers with robust, flexible operational technology underpinning their multichannel business will be in the best possible position to take advantage of emerging market opportunities.

Customer data capture will prove critical to retailers’ growth strategies, as the more the customer journey can be tailored to each shopper, the stronger those relationships will become. Brands with their eyes on the international prize in 2020 will need to focus on creating relevant customer experiences for every market.

2. Store experience – closing the gap between the best and the rest

We’ve touched on the challenges of personalisation in the bricks-and-mortar environment, and this very much aligns with another key challenge that retailers are facing this year: how to ensure that store experiences live up to ever-rising consumer expectations.

Concept stores and cutting-edge flagships have set the bar high; from Fujifilm’s House of Photography to John Lewis’ new store in Southampton, industry leaders are showing what is possible when digital and physical interactions are expertly blended in one space.

But while the best impress, the day-to-day experience of most shoppers is found wanting. Customers are still being plagued by long queue times, poor in-store signage and badly managed information points, when good technology exists to eradicate all three issues.

Equally, many shoppers are frustrated by not being able to get the product they want from the location they want it, as retailers aren’t fully leveraging ship from store and click & collect capabilities to optimise cross-channel fulfilment.

2020 will be a year of reckoning for the bricks-and-mortar basics, with retailers required to put their money where their mouth is and get pain points like queue busting right, in order to close the experience gap between flagships and the rest of the chain. It’s about putting the right technology at people’s fingertips.

3. Returns – the sustainability story 

Returns aren’t a new issue for retailers; serial offending customers cost businesses £7 billion in the UK alone, and the struggle to balance the growth of ecommerce with the rise in returning items is something most brands have been trying to master for some time.

The conversation around the cost of returns is changing, however. It’s moving away from being purely a profitability and stock availability problem, to a wider issue of environmental impact. It’s now impossible to separate brand value from eco credentials – and the sustainability story will only intensify in 2020.

Already, 88% of consumers want retailers to help them become more environmentally conscious, and part of this means reducing the transport footprint associated with returning goods. Meeting this challenge will rely on retailers tackling the root cause of returns, looking at next-generation technologies that improve online product information, exploration, visualising and sizing, so that customers can buy with greater confidence.

4. Engagement – employees takes priority 

In previous years, the term ‘engagement’ has been primarily associated with customers. They are king, and their needs must be prioritised in order to maximise sales opportunities. Or should they?

We have started to see a shift in language among industry leaders beyond customer engagement, to focus on the empowerment of employees. One example of this is Which? Retailer of the Year, Richer Sounds; CEO, Julie Abraham, told Sanderson that “the Richer Sounds ethos is to look after our colleagues first, because if we take good care of them, we know they’ll take good care of our customers,” in our recent secret to outstanding customer service guide.

In addition to empowering employees to serve customers better, retailers appreciate the value (both financial and to their business) of retaining talented team members, in order to lower staff churn.

Employees will become a priority for many more retailers in 2020, and workforce productivity will rest on two things. Firstly, establishing a two-way dialogue between head office and front-line colleagues, so that senior personnel can learn from the day-to-day experiences of customer-facing personnel.

And secondly, retailers will need to put multichannel technology at people’s fingertips, so they have the tools to meet every customer’s needs, no matter how complex or diverse.

Taking technology to task in 2020

2019 was not the calmest of years for the retail industry, and fortunes may continue to fluctuate in 2020, but a challenging market means it’s time to dig deep. As consumers think more carefully about how much they spend, and who they spent it with, retailers taking steps to optimise the customer experience and align strategies with their brand credentials are the ones that will benefit most.

While the exact challenges and opportunities that the next 12 months creates will vary from business to business, one common thread is clear; technology exists to assist and empower, and retailers must use it to their advantage. Investing in the right tools is critical for retailers that want to tackle whatever 2020 throws at them head-on.

Sanderson provides multi-channel retail software solutions that empower retailers to provide seamless, connected experiences. Get in touch to find out how we can support your business in 2020 and beyond. 

Topics: Retail Solutions, Multi-Channel Software, Customer Experience, Multi-Channel Retail