7 Key Habits of High-Performing Retailers That Don’t Include AI

I know you’re probably wondering if this article will be a blast on artificial intelligence based on the headline. You’ve come to the wrong place if you're looking for that. As you’ve probably witnessed, it seems every organization is looking at ways to bring in ChatGPT to improve processes and content — and retailers are no different. From operations to supply chain and personalized shopping experiences, it’s true there’s a bright future for AI in the industry. I agree with that statement wholeheartedly.

However, the retail industry is always volatile as retailers attempt to keep up with evolving economic pressures and changing customer preferences. While the ChatGPT type of AI might be the shiny object of the season, some retailers are experiencing exceptional growth by leveraging current conditions to outpace competitors, expand their market share, and deliver remarkable shopping experiences. How are they doing this? By adopting a strategic mindset and cultivating specific habits that each address a critical aspect of retail operations.

1. Benchmarking across stores and against competitors on the metrics that matter is fundamental. By analyzing foot traffic and performance metrics, retailers can identify best practices and areas for improvement in poor-performing stores. Only with a benchmark in place can you begin to adjust store strategies to bridge the gap to your highest performers.
2. Actively driving more customers into stores — and ensuring they stay — is crucial. Gone are the days of customer loyalty for favorite brands. Shoppers head into malls having already done up to 80 percent of the buying research online. So how do you capture that traffic and get them to stay? This may seem like a no-brainer, but until recently retailers couldn't know with certainty what tactics were working and what were not in driving traffic into stores. Innovative tactics and real-time data analysis can enhance shopfront conversion and customer engagement, helping to impact store profitability and viability.
3. Optimizing conversion drivers involves focusing on elements that significantly influence sales, such as fitting room experience in apparel or experience zones in other sectors. In a recent CNBC article, Geoffroy van Raemdonck, CEO of Neiman Marcus Group, explains that “retail-tainment” will gain in popularity over the next five years. Physical experience spaces — whether fitting rooms, experience zones, or retail-tainment — will become increasingly important for shoppers to see and experience products before they make a purchase. High-performing retailers can measure shopper engagement in these physical spaces, as well as monitor how they impact sales conversion rates.
4. Staffing to demand is harder than ever as many consumers are less tethered to their traditional shopping times, locations and behaviors. High-performing retailers recognize that they must staff to real-time foot traffic. Having the appropriate number of staff to assist customers and support current shopper numbers will ensure shoppers don't get frustrated and walk out of the store without having made a purchase. Gone are the days of focusing solely on entry and exit traffic counting when staffing to demand. Today’s high-performing retailers understand their total shopper opportunity — where shoppers are within the building, where they're making purchasing decisions, and where there's money left on the table due to lack of staff (e.g., at checkout, at the fitting room, etc.). These retailers can dynamically assign staff to higher-priority tasks in response to unexpected shifts in demand.
5. Testing and learning through continuous experimentation allows retailers to quickly adapt to changing trends and consumer preferences, ensuring that their strategies remain relevant and effective. In the old paradigm, retailers would "set and forget" their stores. Today, armed with benchmark data, retailers can easily measure how well a new window display, promotion (or competitor promotion) or sales strategy is performing and quickly make improvements.
6. Taking a data-driven approach to customer experience shifts the focus from subjective assessments to incorporating data from the complete customer path-to-purchase. While there’s no silver-bullet metric to evaluate CX, retailers that are taking steps to quantify it and make better, more informed decisions are reaping the benefits of improved customer satisfaction, brand loyalty and, in many cases, higher sales.
7. Bringing omnichannel to life in stores recognizes the importance of physical stores in the retail mix. Data from the U.S. Census Bureau shows that nearly 85 percent of retail sales still come from brick-and-mortar stores. By seamlessly integrating online and offline experiences, retailers can enhance customer engagement and drive sales across all channels.

While yes, there’s absolutely a place for AI in retail and I’m certain it will help drive real results for the industry, retailers can enhance their performance, meet and exceed consumer expectations, and achieve sustainable growth by embracing these seven habits.

Tom Gleeson is the CEO of Kepler Analytics, the only traffic counting solution that enables retailers to accurately measure storefront and fitting room conversion rates.