How can retailers become more recession resilient?
With talk of another recession around the corner, businesses across all sectors are preparing to batten down the hatches. As we enter this period of economic turbulence and consumers look to reduce non-essential spending, retail is likely to be one of the sectors that's hit the hardest. Retailers will need to do everything they can to become recession resilient. This means finding new ways to retain customer loyalty, hold onto talent across the business, and scale up, all without the advantage of increased budgets. Retailers who can adapt with the greatest agility will be best placed not just to survive the recession, but to thrive.
Make customer experience a first-class citizen
As the cost-of-living crisis rumbles on, customers will continue to be more selective about where they spend their limited cash. This means retailers can't afford to give customers any additional reasons to abandon their carts. The ability to deliver exceptional customer experiences will become a crucial part of retailers' strategies. This might mean implementing new functions and apps. For example, introducing a chatbot to answer customers' queries and guide them through the buying journey, all the way to checkout. Or it could just be as simple as optimising the performance of an existing app so they can complete their transactions faster.
Providing these winning customer experiences will require a proactive approach to observability. However, retailers can't be proactive if they can't see problems coming. Retailers today are faced with a catch-22: moving to the cloud is crucial for achieving the agility they need to respond to rapidly changing customer needs. But this move often comes at the expense of visibility and control, as retailers lack the capabilities needed to monitor their multicloud environments from end to end. Traditional monitoring tools aren't fit for today's complex and dynamic environments, and many retailers are relying upon multiple solutions – but are still encountering blind spots.
To gain valuable insights into the customer journey and see where they might be running into issues, retailers need to be equipped with automatic end-to-end observability over the entire experience. This means digital innovation teams can be notified of any problems in the digital journey before they impact the customer. One retailer that has taken this approach is Photobox, a leading provider of personalised photo products. Before its digital transformation, Photobox had ten separate monitoring tools in place. By adopting an automatic approach to end-to-end observability, Photobox has been able to resolve issues up to 80% faster, often before they have any impact on the business.
Don't add fuel to developer burnout
Another challenge threatening to damage customer experience – and retailers' revenues – is IT talent shortages. In fact, research finds that 72% of tech teams are experiencing skills shortages, and 83% of software developers are suffering from burnout. This is hardly surprising, with developers under significant pressure to keep up with innovation cycles, and with customer expectations for winning digital experiences constantly on the rise. Developer talent gaps present a challenge for retailers at the best of times, with the Great Resignation and 'quiet quitting' still ongoing – but they are especially troublesome during a recession. If retailers don't have access to the talent needed to create new features and digital capabilities – or even keep existing services running smoothly – they're likely to lose customers.
What's more, many retailers simply can't afford to lose their most talented innovators. It's estimated to cost up to $35,685 to hire a new developer, including recruitment fees, the cost of training, and other onboarding expenses. In other words, it's more cost-effective for retailers to keep their existing developers happy than it is to hire new staff to replace those who have jumped ship.
To retain existing tech talent and provide competitive customer experiences, retailers should focus on increasing developer satisfaction and mitigating burnout. By embracing automation in the software delivery pipeline, retailers can reduce the need for developers to manually conduct routine, highly repetitive tasks. This frees them up to focus on building new features and services, speeding up innovation and helping to deliver best-in-class digital experiences that encourage customer loyalty. This will also mitigate developer burnout, meaning existing employees are more likely to stay where they are – saving retailers from the expense of recruiting new team members.
A strategy to weather the storms
As a global recession looks ever more likely, retailers are facing many challenges. Some of these challenges – like developer burnout – have been around for years, but solving them has now become key to retailers' survival strategies.
To thrive amidst economic turbulence, retailers don't need to rip up the rulebook and replace their tech stacks; they need to find ways to do more with less. This means embracing a cloud-first approach and bringing in the tools to 'do cloud right', so they can enable better customer experiences. By automating the processes they use to manage these experiences, retailers can drive greater satisfaction for both their customers and developers, which will have a positive impact on their bottom lines. Ultimately, this will help retailers to weather the economic storm and come out of the other side with a smarter IT strategy that will stand them in good stead for years to come.
