With summer in full swing, we’re starting to see the world open back up as we all embrace a new normal. But, with the Delta COVID-19 variant spreading worldwide and throughout the U.S. we are decidedly not yet past this pandemic. The good news is that vaccines are proving to be largely effective and fully vaccinated customers are enjoying more freedom to return to stores, restaurants, and travel, a positive sign for the retail industry. In this RTQ, we dive into three topics that have our attention this summer.
As we consider the new normal, workforce trends are top of mind. Last quarter, we highlighted adaptability and cloud infrastructure, which will play a key role in supporting the type of office culture many employees expect to come back to. According to Morning Consult, who surveyed 1,067 employed U.S. adults, 75% said they plan on having a hybrid work schedule. This means that as hybrid environments take shape, Microsoft, Zoom, Slack, and others will continue to be tested on how their functionality can ensure employees stay reliably connected while allowing for that “creative spark” or those “brainstorming moments” that employers valued with in-person environments.
Outside of our HQs, it’s clear that rebuilding hourly workforces has become increasingly difficult. Many stores and restaurants have been understaffed, even popular gig workforces like Uber and Lyft have struggled to meet demand. Retailers will likely respond to these labor market trends by adopting new technologies to embrace challenges like scheduling and worker recruitment (startups like Hive Diversity*, Hyr*, and OptIn* are poised to help) in addition to increasing compensation.
Enabling Improved Retail Operations
We’re taking note of increased interest for retail technology solutions that tackle both Supply Chain and Sustainability needs. These two areas of focus are ripe for technologies that can create more efficient shipping/last mile solutions while reducing carbon emissions and improving packaging practices. Startups like Nautilus Labs, Olive, LimeLoop*, ReusePac* Amply Power, and Recurate* are beginning to answer different pieces of this puzzle for retailers.
Finding innovative solutions that overlap business operational areas is key to creating strong cases for piloting new technologies, especially for departments like Sustainability where proving ROI can often be more challenging. However, with the growing importance of ESG and research like ROSI from NYU Stern’s Center for Sustainable Business that help showcase the growing business value of investing in Sustainability programs through a responsive framework – it begs the question; can Innovation programs build out similar frameworks outlining the intrinsic value of investing in innovation to improving overall business value?
Resilient Brick & Mortar
We read a lot about “Digitally Native” brands as a retail disruptor, meeting customers online and circumventing the in-store experience. This coupled with stories about store closures and empty malls creates a sad narrative for retailers. But that narrative is changing, as numerous digitally native brands like Warby Parker, Rothy’s, Glossier, and others who got their start online are putting down roots in brick-and-mortar locations. These brands are capitalizing on their rich customer data to create storefronts in practical locations that not only connect with passionate customers who know them and want to connect with the brand more deeply, but to also capture the interest of new customers who have not yet shopped with them online. Established retailers are taking a page out of the DTC playbook, increasing their focus on omnichannel experiences as well as investing in more in-house brands (for example Target’s All in Motion). Both digitally native brands and established retailers are learning from each other with the lines between them blurring.
Consumer behaviors may change, but retail as a destination will remain.
At RILA’s Retail Innovation Center, we are working to help leading retailers navigate the challenges of transformation by connecting retailers with startups, investors, and technologies that will drive retail in the 21st century. Looking for more? Visit the RIC’s Insights on-Demand page for blogs, webinars, and startup pitch videos.
For any questions about the Retail Innovation Center, please reach out to Katie Nicholos, Senior Manager, Innovation.
*Represents Startup Network members.