The phrase “retail apocalypse” is so widely used these days that it even has its own Wikipedia page. The phrase refers to the supposed end-time for the brick-and-mortar retail model, which has existed since merchants first set up shop in a village square somewhere. Brick and mortar retail is another unfortunate casualty of digital transformation, or so the story goes.
But if you look up the etymology of “apocalypse” you’ll learn that the word actually means to reveal or uncover — and it may be a revelation to all the retail gloom-and-doomers that the brick-and-mortar model is not only surviving but actually thriving.
The vast majority of shoppers still prefer to engage with retailers in their stores, and providing a brick and mortar presence is an important way to attract new customers. Illustrating this trend is the wave of hip, innovative retailers like Everlane, Bonobos, and Warby Parker who started online but are now signing leases for facilities across the country. Even the Wikipedia article includes a long list of retailers who are bucking the supposed trend and expanding their retail square-footage across the country.
Omni-Channel Retail Starts with Brick-and-Mortar
Some of the declarations that brick-and-mortar retail is dying are based on the false notion that retailers take a binary approach to business — they’re either brick-and-mortar, or they’re not. The reality is that most retailers today have a sophisticated, omni-channel model in which brick-and-mortar remains a cornerstone of their strategy.
What the most successful retail brands have in common is a relentless focus on delivering a highly engaging experience across all channels. That’s the holy grail for success in the digital era, where the convenience of online shopping has made it harder for retailers to incent consumers to walk into their stores. For brick-and-mortar stores today, success relies on rewarding customers with a multi-dimensional experience that delights the senses and helps customers better connect with brands.
This experience begins the moment a customer sets foot in a store and takes in the state of the facility. Is it clean and inviting? Is it well lit? Is it modern? This makes facilities management a highly strategic function for brick-and-mortar retail: those who get it right will have a significant competitive advantage.
With that said, here are five tips for how retailers can leverage facilities management to attract and retain customers today.
1. Embrace Brand Uptime as a core mission: The state of the retail (or any other) facility is a measure we call “Brand Uptime”. The best retailers take this responsibility seriously and would not outsource it to third parties for the supposed gain of cutting costs or streamlining operations. Brand Uptime should be as important to a brick-and-mortar retailer as system uptime is for retailers who reach customers through websites or mobile apps. Gauging how good a retailer’s Brand Uptime is begun with a full assessment of the experience offered to customers in their stores.
2. Modernize facilities management operations with Service Automation: Digital transformation is about replacing outdated, inefficient analog systems with the speed, efficiency, and scale of digital technologies. So it should be no surprise that the pen-and-paper way of running facilities management operations would give way to digital forms such as service automation.
Service automation is the leading technology in the broader computer maintenance management system (CMMS) category. It empowers facilities management teams with the ability to initiate, track, and close all repair and maintenance work orders for all locations from a single dashboard. The top benefits include better visibility and transparency into any facilities management operation, which naturally leads to faster results, lower costs and improved services.
3. Use facilities management data strategically: Another big benefit of adopting facilities management technologies such as service automation is the easy access to a broad and varied set of data it provides. The phrase “data is the new oil” attests to the critical role data plays in the business world today, no less in retail companies which collect and analyze just about every data type imaginable. Facilities management operations also generate a wealth of data that retailers can employ and analyze to gain critical insights.
This includes ways to lower costs by eliminating frequently recurring issues within a facility or a particular asset such as an HVAC or refrigeration system. Or it can lead to better store designs by providing facilities data and insights to design and construction teams. The good news for retailers is that they have a rich history of using data strategically to run their businesses better. They need to apply this “muscle memory” to their facilities management operations as well.
4. Hold vendors accountable through KPIs: Visibility and transparency are a two-way street when it comes to the facilities manager-contractor relationship. Too often in the legacy facilities management world, managing the performance of contractors was an exercise in “gut instinct” and not based on measurable data or historical facts. There is no excuse for this with the data that’s now available. Instead, facilities managers can measure and evaluate the performance of all of their contractors using key performance indicators that matter to both the retailer and the contractors.
For instance, which contractors consistently show up on time when they get a service dispatch? Which contractors consistently get the job done right the first time? Which contractors offer the highest value regarding cost efficiency or other financial measures? Evaluating contractors through a standard set of KPIs take the emotion out of the vendor assessment process and helps retailers retain the best service providers while jettisoning those that consistently underperform.
5. Excel in the present, prepare for the future: Artificial intelligence, machine learning, and the Internet of Things. These may sound like futuristic technologies that only apply in the nerdiest corners of Silicon Valley. However, the reality is that these technologies are now starting to be widely applied in retail facilities management operations.
For example, AI and ML are already helping facilities management teams make smarter choices when it comes to the age-old repair-or-replace decisions. IoT systems are used for asset tagging and management, enabling facilities management teams to keep track of important assets through a network of sensors. The mobile app has even changed the way facilities management teams work by enabling them to be more on-the-go while still being able to understand what’s going on at all of their stores from an operations perspective.
The fact is, despite the gloom-and-doom from some naysayers, the brick-and-mortar retail model is here to stay. There is no doubt, however, that things are changing and the status quo is being disrupted. This is for the better. What remains consistent is the importance of the facilities team itself for the success of any brick-and-mortar store. This is why retailers must not only understand but fully embrace the new technologies that can bring their facilities management operations into the digital age.