14 Metrics that Impact Customer Churn in Fashion Retail

Fashion retailers have been seeing disruption to their businesses for over a decade. From digitalization and the “Amazon effect”, to subscription models and fast fashion, most fashion brands have had to operate at a cut-throat level of competition in order to just survive.

In this situation, brands are particularly impacted by the loss of a customer. Not only do they experience a direct loss of revenue, but in an industry where social influence and peer reviews have a high impact, there is a cascading effect through loss of referral business. This can, in turn, impact future customer acquisition costs and marketing efforts as well.

Knowing the metrics that impact your churn can help you better understand why your customers are disengaged. By identifying potential churners before they leave, retailers can take proactive steps to neutralize it.

  1. Breadth of Purchase (cross-category): Breadth of purchase refers to the variety of products that a customer buys. Lower cross-category purchases can indicate customers who are not deeply engaged and may simply churn for a better price point.
  2. Customer Complaints: Who is complaining and why? Measuring this metric can help you know how close a customer is to churning. Complaints that are common to a category or product can be early indicators of larger concerns. Additionally, mentions in poor service, in-flexible returns/ exchange or frequent complaints can indicate that a customer is looking for other options.
  3. Feedback Scores/ NPS: Churn is closely tied to customer satisfaction, so Net Promoter Score (NPS) which measures the willingness of customers to recommend a company’s products to others can be used to understand high or low levels of customer brand loyalty.
  4. Repeat Purchase Rate (RPR): This tells you the effectiveness of your marketing strategies and retention programs. Brands can isolate one-timers and focus their energy on making them visit again, which can yield higher gains than trying to acquire new customers. The revenue from a single repeat shopper is equal to that of around 6 new customers.
  5. Repeat Purchase Probability: Different from the RPR, the RPP is closely related to the churn rate, as customers less likely to make another purchase are more likely to churn. In fact, studies have shown that conversion rates of repeat customers are much higher – a customer who has purchased twice in the past is about 8X more likely to convert than a first-time shopper.
  6. Customer Lifetime Value: Customer lifetime value is the future profit your business can earn from its relationship with a customer. This is based on past purchasing behavior and their likelihood to remain engaged with your brand; it is a key metric to identify your top acquisition channels and optimize your customer interactions in a way that prioritizes your best customers.
  7. Recency: An important and often under-rated metric, recency is the time since the last transaction. By segmenting customers on recency, you can detect the impact of marketing on purchases, and filter customers most likely to churn. This often isn’t as straight-forward as it seems, because in fashion customers don’t return at fixed intervals. However, if a customer that always visits during events such as Back-to-School or Black Friday sale doesn’t show up, it is a cause for concern.
  8. Average order value: Average order value measures the average amount of money a customer spends per purchase or average basket value (size) per order. By understanding the basket size trend, retailers can spot anomalies in purchase behavior and identify if the customer is showing early signs of churn.
  9. Product Reviews: Product reviews are often an indication of customer satisfaction. Consistent poor reviews could indicate that a customer is in search of other options, and also create a wider negative impact, making it harder to acquire new customers.
  10. Profitability Per Order: In addition to business success, a high PPO can also indicate if only higher margin products and full price merchandize are being sold, giving you information on whether your tactics are successful or whether churn is eroding your profits away.
  11. Purchase Frequency: How often the average shopper makes a purchase indicates how engaged they are. A customer returning frequently for their needs indicates you are top of mind and are better positioned to drive higher revenue from them.
  12. Time Between Purchases (TBP): The gap between purchases within a one-year period is the time between purchases (TBP). Knowing this value can you give you insights into buying patterns and segmentation, enabling you to better understand which groups are churning.
  13. Redemption Rate (RR): The percentage of loyalty rewards being redeemed is your redemption rate and a direct indication of your customer engagement levels. The average rewards program sees a redemption rate of 14%, and retailers that are too far off from their benchmarks need to when to act to tailor the program.
  14. Product Returns: Like customer complaints, measuring product returns can indicate which categories are likely to make a customer churn. A high return rate from an individual can build up dissatisfaction with the brand and reduce their chances of shopping again. Additionally, social feedback on product quality shared with peer groups can have a high impact on churn.

The importance of controlling churn

Fashion retailers find it especially hard to identify customers at risk of churning – shoppers don’t buy at fixed intervals and loyalty is at an all-time low. Customers that seem to be disengaged might still be interested in your brand, just not reached their re-buy period yet.

Investing in customer retention programs can make all the difference to business growth. According to Bain & Company, increasing customer retention rates by a marginal 5% can increase profits by a whopping 95%.

It is therefore critical to study the behaviors, interactions and experiences that are driving the customer relationship, to measure churn and take effective steps to minimize it.

Manthan enables marketers to execute comprehensive churn management programs. Custom-built for the retail industry, our responsive algorithms, and AI-driven execution capabilities provide marketing teams with the insights and control they need, to proactively engage with at-risk customers.

For more information, read AI Driven Approach to Boosting Customer Retention in Retail

Author- 73criz

The Editorial Board comprises technologists, data experts, thought leaders and marketing gurus. We are dedicated in helping business leaders unlock the true potential of analytics.

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Menu Engineering: Real-time insights enable menu optimization

An optimal menu not only drives financial success but also enhances guest experiences. This makes Menu Engineering a key aspect of QSR strategy. With real-time insights, Operations Leaders could engineer their QSR menu to keep costs under check while ensuring customers’ favorites are firmly placed in the menu.

 

Personalized menu with advanced customer insights

The sudden spike in online ordering through apps presents immense opportunity for QSRs to hyper-personalize customer experience. And menu personalization is a key element of the overall experience. Data on customers’ taste and preferences are collected and analyzed. Using machine learning and AI technology, the app shows users the most relevant menu items, promotions and content based on their individual preferences, past dining history, location, weather and restaurant specific menus and pricing.

With data and intelligence, menu engineering is more science than art, in today’s times. An advanced AI platform helps you engineer your menu across outlets, reduce cost and drive loyalty. The underlying need to design optimized menus is Data – menu items, number sold, food cost, menu price. Clean and structured data on your customers, likes, preferences, transactions, affordability, menu items and their costs are some of the key inputs to the menu formula. 

Advanced algorithms analyze the demand and costs of menu items to help you identify your most and least profitable menu items. AI platforms integrate with back-of-house systems to draw this data and throw up in-depth intelligence to help make smart decisions on menu and other aspects of QSR business. 

An advanced BI and Restaurant Analytics platform provides real-time insights to re-engineer your menu, forecast sales, reconcile 3rd party sales, optimize delivery time and more.

Let AI help you identify your Stars on the menu

Manual menu analysis is bereft of inaccuracies and never complete. This leads to loss of revenue opportunities and impacts profitability. As alluded to earlier, data and intelligence could help identify popular menu items across stores and locations in real-time. Advanced algorithms map trends, cull out underlying reasons and recommend next best actions for menu items. For e.g., Algorithms throw up the bestselling pizza by size, day, topping, location and recommend menu combos that would help you leverage its popularity. 

By adding data on item cost and profitability to sales of menu items, you can be sure to accurately identify the best and worst performing items, from your long menu list.  Using this, QSRs could develop an action plan to optimize the menu by reducing low profitability items and increasing the popular ones. 

Menu engineering is about managing this mix of stars, plow horses, dogs and puzzles that leads to reduced costs, improved profitability without compromising on customers’ wants. Let’s see how algorithms could help in arriving at the right menu mix.

Make your STARS shine brighter

Algorithms identify Star menu items based on factors such as sales volume, costs, price, margins, promotions, etc. They help you analyze the underlying reason and recommend ways to make the most of these popular and profitable items on your menu. AI platforms recommend:

  • Other locations where these items can be introduced to enhance revenue opportunity
  • Price increase by calculating the likely impact on demand
  • Menu combos with other items that are lower in profitability, using association mining

Let your PLOW HORSES gallup

Algorithms are quick at identifying items that are growing in popularity. Juxtapose this data against its costs and you know whether you are heading towards the left of the balance sheet or the right. Trust the AI to do the magic – menu combos that offsets the low profitability of the item or more dishes with high priced ingredients for economies of scale. You may just end up with Star with AI-based recommendations.   

AI solves the PUZZLE

With a 360-degree view of sales, marketing & operations data, AI platforms turn into Sherlock Holmes to find that missing piece of the puzzle. Run the analysis and in a matter of seconds you’ll know why they are not flying off the shelf. Turn the recommendation engine on to increase their demand. Reduce price, introduce an offer or run a campaign, these algorithms have a marketing trick up their sleeve. 

Let the DOGS take a walk

While the algorithms are quick at identifying Dogs and recommending their expulsion, human intelligence needs to prevail here. For e.g., Kids’ menu is neither high volume nor highly profitable ut you may want it to stay on the menu. 

Optimize QSR menu with Algorithms

Data and Intelligence are the key ingredients in dishing out a menu with the right mix of Stars, Plow horses, Puzzles and Dogs. Advanced AI tells you what’s popular and why. Likewise, it helps you understand the implications of cost and pricing. And this is a dynamic exercise as customer tastes and preferences, economic and social situation, change. With real-time access to data & insights, AI platforms help you balance high and low food costs to garner a reasonable amount of profit margin yet cater to customers’ preferences. 

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How technology can mend the COVID-19 infected supply chain

Across the world, we are seeing the issues in a fragile supply chain being exposed, specifically in Grocery & Pharmacy segments as they fall into the essential category and seek faster replenishments.

Today’s crisis scenario has resulted in 40% of retailer members of the National Retail Federation to say that they are experiencing supply chain disruptions due to the coronavirus, with an additional 26% expecting to experience disruptions.

The Lean Supply Chain is Now Anorexic

Grocery retailers have in the past few decades, made their supply chains lean, in a model similar to the automobile industry. As a result, grocery retailers have been minimizing inventory, and delivering “just-in-time” products to shelves, as soon as a product is purchased.

The advantages of adopting this were lower inventory carrying costs, minimal product handling and the need for less storage space. But the downside, being experienced by the world today is that unforeseen surges leave stores in a quandary as inventory is not readily available.

Is Technology the Cure?

Supply chain resilience requires retailers to invest in technologies that offer greater clarity into understanding what goes on within the supply chain. Additionally, retailers such as grocers or pharmacy need to have contingency plans to anticipate shortages created by demand surges or supply disruptions.

Today’s supply chain challenges are multiple according to a Digital Commerce 360 survey of over 300 retailers in mid-March. Supply chain communication topped the list (48%) of actions they’re taking as a result of the coronavirus. Others are contingency planning (34%), hoping to minimize disruptions (32%), monitoring the coronavirus situation in China (23%) and working with their partners to mitigate supply chain risks (22%).

More recently many of the larger retailers have been investing more in supply chain technology in order to reduce forecasting errors, track assets accurately and improve order accuracy.

A report by GEODIS found that only 6% of companies surveyed worldwide had achieved full visibility into the companies that make up the sub-tiers of their supply chain. The complexity we have today makes mapping simultaneously more costly and time-consuming, though it is increasing its importance and beneficial insights.

Let’s look at some of the ways, technology is helping retailers overcome the supply chain gaps during the COVID-19 crisis.

Advanced Collaboration Platforms

Better collaboration with vendors through connected systems can lead to an overall improvement in supply chain resilience. Supply chain collaboration platforms can make it easy to reduce the time spent shipping, receiving, tracking, and compiling order data. When combined with collaborative features and analytics, retailers will find it easier to optimize supply chain efficiencies while mitigating risks.

Integrated Portals for Real-time Information

Real-time data is helping retailers manage their supply chain decisions and be able to focus on the movement of essentials. A survey conducted by the Retail Systems Research in March 2020 amongst qualified retail respondents showcases that 76% of retail winners believe that real-time visibility remains an underlying driver of supply chain performance.

Real-time information can be shared by integrating suppliers on a web-based portal. By using a platform to offer end-to-end visibility, all the stakeholders in the supply chain can have the visibility of on-hand inventory and of changes in product demand. 

Expand Supplier Networks Faster

To be able to handle the shortage situation, retailers today have been seeking out more suppliers. But traditionally on-boarding new suppliers and products is a time-consuming process.

Increased global disruption often demands faster decision making. To solve this issue, technology can help create centralized, web-enabled repositories of suppliers, which retailers can access. Suppliers who are up and running can list their catalogues, allowing retailers to locate and identify which suppliers they can work with faster.

The Retail Systems Research reports that the top opportunity for retail success is to improve their forecasting capabilities, along with improving compliance from suppliers. Intelligent search tools and regulatory compliance can be pre-checked when the supplier lists themselves, saving tremendous time and duplication of effort by every retailer the supplier connects with.

Replenishment Automation

A report by McKinsey predicts that automation could accelerate the productivity of the global economy by between 0.8% and 1.4% of global GDP annually. In other words, supply chain automation is both cost-effective and leads to higher profitability.

Enabling integrated systems can offer retailers the ability to assess and automate which key supply chain processes can be automated. With the right supply chain solution, retailers can enable a seamless operation, which then helps automate activities such as inventory replenishment.

CONCLUSION

The World Trade Organization expects that global trading will fall by between 13% and 32% during 2020, and almost all regions will experience double-digit declines in trade volumes this year due to the pandemic.

The ability to adapt responsively to this reverberating disruption in the supply chain operations will truly separate the winners from the losers during the COVID-19 crisis. Whether grocers and pharmacy companies use this crisis as a wake-up call, remains to be seen.

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Remaining true to its mission of “Serving the Underserved” during supply chain disruptions at Prince Retail

While the COVID pandemic has amplified the many challenges that plague the Supply chain across industries, it has also brought to light the resilience and innovation to help alleviate some of these.

Retailers across segment were most hit, but they also had to bounce back the fastest and continue to serve the community. One such company is Prince retail, which recently celebrated its 30th anniversary during April this year. Present mostly in semi- urban and rural areas across all major islands and regions in the Philippines.

We had a chance to interact with Rina Janine Sy Go, Supply chain director at Prince retail on how they have been rethinking their supply chain approach in the face of this crisis.

 

How has the COVID-19 situation impacted Prince Retail Group and the grocery industry at large?

The COVID-19 situation has largely impacted the entire grocery industry when the demand for food and basic commodities increased and supply could not cope up with the demand. Due to panic buying that followed once the lockdown was announced, we were grossly unprepared to handle the demand and the immediate restrictions that were imposed overnight.

Even today, we are largely struggling with our supply chain as vendors are battling with the non-availability of stock due to restrictions in the mobility of their workforce and scarcity of raw materials. Our workforce is faced with challenges while working in our stores and distribution centres. Even our order to payment processes to support the stores were not equipped to support the immediate work from home requirement. It was like fast-tracking our 2-year roadmap for digital transformation strategies to 2 days.

Currently, we are still struggling with the entire operations while trying to sustain availability in our stores. Although it was through this crisis that we really saw the impact we have on the communities we serve. Since our stores are mostly located in rural and far-flung provinces, we were literally the only source of supply that had relatively complete and stable stocks that could feed these communities who were unable to travel to the closest urban cities due to mobility restrictions.

It truly made our mission of “Serving the underserved” very evident. 

 

What was the first response to ensure Business Continuity (BCP) at Prince Retail?

At Prince retail, we believe in being proactive and wear our customers hat and come up with solutions which serve their needs. However, this pandemic is unprecedented and needed out of the box thinking from day 1. Our immediate response was to map the entire supply chain process from order to payment as this was the process and functionality that needed to be available during lockdown.

Together with our leaders in IT, HR, Logistics, and the functional teams, we had to ensure all these processes continue to be available during work from home, so we came up with ad-hoc solutions.

By contacting our telco provider, procuring as many laptops as we could and finding creative ways to get connectivity to the homes of our teams.

We also had our company bus pick-up and drop-off select employees who had no means of transportation.

The store operations team did the mapping of the workforce homes so they could still be available in the stores and if they could not, we find back-up workforce and set up staff houses for employees in critical roles.

It was basically a series of quick and iterative decision-making sessions between key leaders in the organization to set up the whole thing overnight. It involved a lot of cooperation, quick thinking, creative planning, and flexibility from everyone involved.

 

Innovation is the need of the hour and with limited resources in the current crisis what are some of the ways you are addressing it? 

With finite resources coupled with restrictions, innovation was the only rescue. We streamlined the SKU's and vendors so we would prioritize our ordering to cope with the new way of working during lockdown, all this while supporting over 60 stores across the country in remote areas. We could not continue with all the business as usual SKU’s and focused only on the ones driving high demand.

We set up communication lines and chat groups for each team involved to ensure the right problems were being addressed immediately – and connected straight to the top management. We also set up new store processes to deliver directly to our customers who would SMS, email, use Facebook messenger or call in with their orders.

We grouped the deliveries by zone depending on their residential areas to streamline deliveries. This was something that we had never done before but we set up this entire process of working from delivery to payment in just 2 days.

We had to think of making our existing processes flexible and adjust to working in these new conditions so we can continue to serve the community.

 

Based on your learnings on the COVID-19 pandemic so far, what can grocery retailers do to improve their proactive response in scenarios such as these in future?

As Mr. Winston Churchill said once “Never let a good crisis go to waste”, retailers across the globe will use this crisis as a learning to prepare better for future. Retailers should be able to have more flexibility, mobility and redundant resources that can enable the entire supply chain and payment workforce to work from home or remotely, rather than being entirely dependent on the head office physical structure. This was our major learning and pain point.

Digital transformation should have been now rather than later. Retailers should also have higher inventory covers of basic commodities which worked for us because historically, we always carry large inventories of these goods due to the remote locations of our stores and this actually worked to our advantage when we were hit by the crisis.

Retailers should also be ready with an e-commerce strategy and we were lucky since we were already doing pilot runs of a B2B application in 1 store, that we are currently fast-tracking now to allow B2C as well (doing data cleansing, application preparation, technical fixes), and a quick roll out to stores once the crisis is over.

 

Do you see any consumer behavioral changes for–good post the crisis?

These are some consumer behaviours that will change for good especially in the Philippines and with our market in the lower socio – economic bracket. We see a shift in demand for bigger packs and more savings rather than the traditional sachet economy due to reduced frequency of purchase. We also are seeing the acceptance of digital processes for ordering, getting information, and servicing, which means more digital marketing for us as well. We also forecast a bigger importance on health and sanitation. These are SKU's which were previously not a priority especially for our market. There are also changes in how consumers will be choosing their products, brands they pick based on whatever is available at the store level, and preference for more value for money products with a global recession already underway.

Just like Prince Retail collaborated for continuity to defeat disruption, your organization can too. Click to learn how

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COVID-19: and the elevated challenges in supply chain

In March 2020, the Institute for Supply Management (ISM) conducted a survey that focused on the impact of coronavirus disease (COVID-19) on supply chains. Nearly 75% percent of companies reported supply chain disruptions.

The unprecedented outbreak has caused many businesses to experience multiple challenges including shifting customer demand, transport restrictions, shortages, and more.

According to Food Navigator, Nestlé CEO Mark Schneider warns that the business must ‘get ready for the storm’ as supply chain challenges are expected to intensify.

Let’s take a look at some of the new challenges that COVID-19 has placed on retail supply chains:

Digital Collaboration and Supplier Communication

Collaboration and communication can enable transparency and faster responses to operational decisions on both sides. But retailers have often lacked the data and collaboration technology needed to centrally manage operations of both the supplier and the retailer.

The COVID-19 crisis has shoved into the spotlight the traditional paper-and-time intensive activities associated with Supply chain. Digital collaboration is the need of the hour as retailers explore the possibilities of collaboration across every aspect of the supply chain process.

 

Lack of Visibility in Supplier Operations

Sharing of information across the supply chain is key to avoiding potential demand-supply issues. Grocery retailers in particular, during the COVID-19 crisis need visibility across the supply chain to better address issues like OOS (Out Of Stock) and surplus stock of non-essentials.

Information needs to be shared with all supply chain stakeholders for logistic decisions to be made that help businesses to operate more efficiently. Yet, according to Supply Chain Digital visibility is a central challenge for supply chain managers today, with 94% of companies admitting that they don’t have full visibility into their supply chains.

To mitigate these issues in the short-term, supply chain leaders are working to create transparency and rapid response capabilities. One of the ways to do this is to use a technology platform that brings suppliers and manufacturers together for visible collaboration.

 

Volatile Inventory Demand

During this crisis situation (or any crisis situation for that matter) it is not unusual for consumers to panic hoard essential commodities. This results in a stress on retailers like grocers and pharmaceutical companies to manage an unexpected spike in product demand.

A Nielsen data report indicates that sales of oat milk, surgical masks, first-aid kits and other non-perishables spiked late in February 2020 in response to coronavirus fears.

On the flip side, non-essential items pile up, as there are no takers. Retailers today are struggling to know their current inventory supply, and be able to replenish demand essentials without sustaining losses.

Many retailers are managing this by ramping up warehouse and distribution numbers, while others are using warehouse management technology to assess inventory, predict peaks and coordinate employee shifts to keep supply moving. Retailers are also being pushed into moving inventory and resources to new channels. Because of today’s social distancing norms, there’s been a growth in ecommerce orders, and retailers are moving inventory by making it available online for purchase and working with distribution channels for fulfilment.

RIS News reports that Amazon Fresh and Whole Foods Market have increased order capacity by more than 60% due to COVID-19. The number of Whole Foods Market grocery pickup sites has grown to over 150 in the past few weeks, up from around 80 stores. Additionally, Amazon's store in Woodland Hills, is now serving as a temporary online-only store that's focused exclusively on fulfilling grocery delivery orders.

 

Limited Supplier Dependency

Pharmaceutical companies in particular are currently facing a crisis in their supply chain, as a majority of active pharmaceutical ingredients are developed In India and China. 

According to Thomas Derry, CEO of ISM, “Organizations who diversified their supplier base after experiencing tariff impacts, are potentially better equipped to address the effects of COVID-19 on their supply chains.”

While some pharmaceuticals often have a redundancy in drug supply of such drugs, companies which contract with multiple suppliers can prevent disruptions from causing shortages.

 

Lack of Data for Agility

Any technology platform that can help retailers stay on top of their supply chain activities, relies heavily on standardised data to collaborate and communicate effectively. However, for most retailers, data is still siloed and not standardised for sharing on collaborative platforms. 

Yet the use of information technology to share data between supply chain partners is crucial for agility. For retailers to be able to survive amidst chaotic demands, information sharing between and within the supply chain players is a critical requirement towards optimizing supplier-retail relationships.

 

Where Will Retailers Go From Here?

Shifting from a traditional supply chain to an end-to-end information management, can help retailers respond faster, reduce redundancy and maintain supply chain efficiency.

For more information on how your retail business can manage its supply chain during this crisis, Learn more on " Minimising Supply Chain Disruptions During COVID-19"

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The Pandemic is Impacting Restaurant Businesses, and They Are Stepping Up

The novel coronavirus has affected restaurant businesses heavily, as governments across the world are enforcing social distancing rules and discouraging public gatherings. Concerns related to food safety and hygiene have also emerged among customers, though there is no evidence to support the transmission of COVID-19 through food.

Customer footfall is down tremendously and only cloud kitchens, delivery and takeaway models are operational. In response to the current crisis, restaurants are getting creative and coming up with innovative ways to fight back.

The challenge is unprecedented, but restaurants have quickly undergone a seismic shift by thinking out of the box. Let’s look at some of these short-term changes implemented by QSR chains to stay relevant,  engage customers and do their bit for the community.

New Operational Models of Food and Essentials Delivery

1. Safe Delivery Initiatives by Junzi Kitchen

 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
 

 

 

 

 

 

 

 
 

 

 

 

 

 

 

 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 
 

 

 

 

 

 

 

A post shared by junzi (@junzikitchen) on

 

 

 

 

 

 

US-based fast-casual restaurant Junzi Kitchen had started their contactless delivery model four weeks ago that allowed couriers to drop-off the food package at the door of the customer. As tensions have escalated, they have adopted a new practice – delivering the food with a new ‘integrity seal’ that protects the bags from ripping open on its way to customer location.

2. Restaurants Signing Up for Online Food Delivery

Deliveroo Singapore has reported a 50% jump in restaurant sign-ups as a growing number of eateries are looking to join the online food delivery business model. As per reports, 600 new restaurants in Singapore have signed up since late January to deal with the drop in customer footfall.

3. Domino’s Pizza India Partnered With ITC For Delivery of Essential Items

Amid the 21-day countrywide lockdown, Jubilant Foodworks that operates Domino’s Pizza in India has tied up with ITC Ltd. to supply its Aashirvaad brand of wheat flour and spices to customers. Domino’s is leveraging its pizza delivery network to deliver grocery essentials to customers, through the “Dominos Essentials” section on its mobile app. This comes at a time of disruptions in the logistics network, making it harder for households to buy goods of daily use. Demand for home delivery has also surged with the government advising people to stay indoors. 

 

Investing In Mobile Apps

1. Mobile Ordering Saving the Business for Duck Donuts

Duck donuts’ USP was made-to-order donuts, and hence the shutdown was particularly challenging for them. Thankfully, they had launched mobile ordering in 2020, that gives them the option to salvage sales, while providing ordering convenience. In addition to curbside service, some franchisees are creating the made-to-order experience in deliveries, by providing add-ons of sprinkles, toppings, etc. that customers and children can use to decorate donuts at home.

 

Trimming Their Menu To Bestsellers

1. McDonald’s USA to Remove Unpopular Menu Items

McDonald’s USA has decided to cut short their elaborate menu in the light of the coronavirus outbreak. The idea is to simplify their operations as they work with less staff and plummeting customer traffic. Restaurants are likely to leverage the offerings of data and analytics to pinpoint their bestselling items and drive sales through personalization via mobile apps.

Innovative Ways to Keep Customers Engaged

Customers of Burger King France are huge fans of their Signature Whopper burger. With an easy-to-follow picture guide, the burger chain tweeted the recipe of the Whopper burger to let the customers make it at home. As the tweet gained traction and engaged customers, Burger King France went on to release recipes of more of their popular dishes. 

 

Implementing Social Distancing Measures

Subway and Domino’s chains in Singapore are doing their bit to enforce social distancing in their food joints. The stores have demarcated designated ordering areas and made seating arrangements to ensure the safety of the customers. Hourly cleaning and sanitizing of all customer touchpoints are also part of their efforts to curb the spread of the virus. 

 

Giving Back to the Community

In the midst of huge revenue losses, restaurants are still coming forward to fulfill their social responsibility towards medical personnel and their employees who are risking their health and safety for their work. 

Serving Healthcare Workers and Frontliners

1. Free Meals for Medical Personnel

In a humanitarian move, Nando’s North America has launched a Community Service Program with the aim to bring hot catered, free meals to the hospitals near all Nando’s outlets. They have also pledged to provide free takeout to healthcare workers who walk in with a valid ID and donate surplus food to local food banks.

2. Delivering Happiness for the Frontliners

Cafe Amazon, Tim Hortons, BonChon and Dairy Queen are doing their bit to help and support healthcare workers, medical personnel and front liners during their fight against the Covid-19 pandemic in the Philippines.

Minor Food Group in Thailand, and its brands – The Pizza Company, Sizzler, Dairy Queen, and Burger King, have extended assistance to the frontline medical workers across the country. Their initiative is to deliver food and sweets directly to the hospitals as a token of support and appreciation.

 

Addressing Employee Needs

Jollibee Food Corporation in the Philippines has launched an emergency fund of PHP 1 billion for its employees who cannot make it to their workplace due to enhanced community quarantine measures.

McDonald’s Philippines have also announced a special package for the employees who are risking their safety to go to work at their select stores that are open in the midst of the pandemic. 

Chipotle Mexican Grill has started to give their hourly employees who are still willing to work a 10% increase in their salary as a token of appreciation. 

Yum! brands, through its brands Pizza Hut, KFC, Taco Bell and The Habit Burger, have launched multiple initiatives in the month of March, helping communities, employees and franchisee operators. Right from providing free meals to front-line workers, healthcare professionals and children impacted by school closures in the US, to providing financial support to employees and restaurant managers and books to families in need.

The increasing ‘shelter at home’ mandates have given restaurant businesses a push to think outside the box! Social distancing is the motto of the day, and probably for many more months ahead. Restaurants have the opportunity to be creative and many are adopting new-age technology and becoming more data-driven. Investments in mobile apps is on the rise, and so is the quest to upgrade their personalization to drive sales and online customer engagement.

Will the changes in consumer behavior last, long after the crisis is over? Will the new methods of operation and surge in online ordering stay for good? What do you think?
 

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Retailers Pivot: Response to COVID-19 is Pushing Innovation

Around the world, retailers are finding new and innovative ways to help their customers cope with the lockdown situation we all find ourselves in. Retailers are responding by focusing on immediate customer and employee needs and fulfilling them in unique ways, through e-commerce, delivery services or special provisions.

They are at the forefront in maintaining normalcy, supporting communities and helping their staff stay calm and focused in these trying times.

Let’s look at some of the examples of innovation around the world:

Shopping Slots for Vulnerable Customers

Across the world a number of stores including Tesco, Waitrose, Albertsons, Sainsbury Woolworths, Walmart and Costco are dedicating time for senior shoppers. By focusing on this at-risk demographic, retailers are helping those who may be struggling under quarantine and unable to manage rush hour for retail supplies by offering them special slots. Coop Sweden, through their e-commerce site, has introduced extra delivery slots for senior citizens and other at-risk groups.

Work-Related Bonuses, Raises

Love's Travel Stops & Country Stores announced that it is giving hourly store employees a pay increase and a bonus during the national emergency, as the US government recognizes truck stops as essential to keep goods moving across the nation. Also joining the fray are Canada’s Dollarama and Walmart Canada offering bonuses and premium pay programs to help stay open during the pandemic.

Making Hand Sanitizers

Distilleries around the US and LMVH, a luxury goods company in France, are putting their expertise to use for the public good, making hand sanitizer for free distribution to combat the COVID-19 pandemic. In India, Radio Khaitan which makes whisky and vodka is set to expand the use of extra neutral alcohol at its Rampur distillery into the production of hand sanitizer.

Gap, Zara Producing Masks

Fashion retailers like Hanes, Gap and Zara are working towards utilizing their resources to manufacture personal protective equipment. Zara also confirmed that their company would start making medical gowns once they had managed to source medical grade materials and fabrics. Hanes known for making cotton basics ranging from T-shirts to underwear, is converting its factories to produce cotton face masks in the United States. Recently Neiman Marcus has also reported that its sewing team is making scrubs for medical personnel using fabric from Joann Fabrics & Crafts.

Limits on Purchases

Many retailers are minimizing the effects of panic buying by placing quantity limits on what a customer can purchase on products such as sanitizers, cold and flu related medication, and other essentials.  Other retailers such as the Rotunden market in Denmark, has used a unique pricing model to discourage hoarding for in-demand items during the pandemic. As seen in photos posted to social media, the shop is charging 40 DKK (around $5.75) per bottle, but 1000 DKK ($143) per bottle if anyone wants to buy more than one.

Plexiglass Checkout Protection

Giant Eagle Inc. the biggest grocery chain based in Pittsburgh and Kroger have made changes to its checkout counters to help customers maintain social distance and avoid the spread of COVID-19, by installing new plexiglass dividers at each register. This they believe will help create a physical separation between checkout clerks and customers protecting their employees while continuing to serve people. Swedish retailers Willys and ICA have also installed plexiglass panels across all their stores. Willys added tape marking to the floors of checkout lines to remind shoppers to keep a safe distance from each other.

No Contact Deliveries

Delivery service Instacart’s sales grew exponentially in the US, leading the company to start a "Leave at My Door Delivery,” which enabled shoppers to receive grocery deliveries without being present, rather than having it handed to them at the door. Postmates has followed suit and introduced non-contact deliveries by offering curb side deliveries or having them left outside the door.

Reduced In-Store Contact

Starbucks is pausing the use of personal cups and “for here” ware such as ceramic mugs. All drinks will now be served in disposable cups for the time being in the U.S. and Canada. Trader Joe’s is also reportedly altering the way it doles out samples to limit customer contact, and Costco has suspended samples altogether in some of its locations.  

Advertising Waivers

Yelp has announced relief to businesses impacted by the coronavirus as well as waived/free advertising costs for independent local restaurant and nightlife businesses, products and services.

Emotional Support – Digitally

Swimwear start-up Summersalt, is offering customers emotional support through a free text message hotline — called “Joycast” — which allows people to reach out if they need something to lift their mood.

Funding and Donations

Walmart announced that its foundation has committed $25 million to support organizations responding to the Covid-19 outbreak including $10 million to support food programs, $10 million to support efforts in local communities in the United States and international markets, and $5 million to help countries prevent, detect and manage the outbreak.

Taking Care of Partners

UK Grocer, Morrisons is on track to speed up payments to its smallest suppliers to help with cashflow during the outbreak. UK’s fourth-largest supermarket chain is dependent on small suppliers for thousands of items it sells every day, and believes that swifter payments will help small businesses better handle disruptions.

Free Digital Content

ACK Media, publisher of the popular Indian Amar Chitra Katha and Tinkle comics has offered a free one-month subscription to everyone in the wake of school closure in India. Users will be able to access the entire catalogue of Amar Chitra Katha and Tinkle titles via the ACK and Tinkle apps.

Helping With Food Distribution

Clothing retailer, L.L. Bean is using its shipping hub to pack food for pantries across the state, by partnering with Maine's largest food bank, Good Shepherd. Company workers will sort and package food in boxes that Good Shepherd will ship to food pantries in 16 counties.

Free Meals for Health Workers

Healthcare workers and first responders are being hailed and supported around the world. Uber is giving over 300,000 meals for free to those who are helping combat the coronavirus pandemic. In China, KFC is also supporting frontline medical personnel by offering them free meals.

Fitness Challenge on Digital Platforms

In China, Under Armour began sharing exercise tips across its digital platforms MyFitnessRun and MapMyRun, which later became the brand’s ‘Healthy at Home Challenge’. Their 30-day fitness challenge encourages individuals and families at home to stay healthy and physically active. Under Armour will also donate up to $1 Million when users join the challenge, to support Good Sports’ efforts.

 

Has the quarantine situation given retailers a push to innovate? Will the learning lead to new methods of operation and newfound ways to use digital channels, even after the crisis has subsided?

If you know of a retailer, big or small, that is responding to the global crisis through technology, write to us as we continue to follow and discuss innovative activities of retailers around the world.

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