What Trends Are Driving Store Ops Budgets? - Retail Innovation Conference & Expo

What Trends Are Driving Store Ops Budgets?

The Store Operations Survey has become a pillar resource for Retail TouchPoints. Through a survey of retail executives and practitioners, the editorial team has identified top store priorities and the challenges facing managers and operations teams.  
 
Every year, associate hiring and retention have been respondents’ top challenge. But this year, the context surrounding these challenges is very different. Associate turnover has reached a record high and retailers are simultaneously navigating complexities surrounding:  

  • New omnichannel behaviors and CX preferences;  
  • Organized retail crime and theft prevention; and  
  • The ongoing integration between store operations, marketing and design. 

The good news? Retailers’ store operations budgets have increased. While 42% of respondents said their budgets slightly increased, an additional 27% said their budgets significantly increased.  
 
The top three areas where retailers saw their budgets increase include:  

1. New In-Store Technology 

62% of respondents said their in-store technology budgets increased year over year, while 25% said their budgets stayed the same. It is no surprise that this category saw the most love; the right in-store technology investments can improve the customer experience and the employee experience. They also will help retailers tackle other challenges, such as improving employee training and engagement (another big investment area), as well as boosting the profitability and performance of stores. 
 
Of course, mobile is the star of the store ops technology show — and it has seen a significant year-over-year increase in adoption. Last year, 71% of respondents said they armed associates with mobile devices and this year, that number has swelled to 82%. Retailers also have invested in a range of tools to transform these devices into “super apps” of sorts. Top capabilities include:  

  • Access to product and/or pricing information (68%);  
  • Online ordering of out-of-stock products (62%);  
  • Access to inventory levels and product availability (60%);  
  • Mobile payment (57%); and  
  • Task management (56%).  

 
Respondents said that when they invested in mobile technology, they saw an improvement in productivity (59%), cross-sells and up-sells (50%), employee job satisfaction (46%) and other benefits. Retailers also are exploring the role that customers’ mobile devices can play in improving store operations and experience. For example, 58% of retailers said they have implemented QR-code activated digital signage and kiosks, while 53% have embraced mobile-integrated digital signage. Retail TouchPoints also saw a marked increase in RFID adoption, autonomous POS / self-checkout technology and even customer fit technology.  

2. Employee Training & Engagement  

61% of respondents said they had more money to spend on employee training and engagement. When asked to identify their top challenge of 2023, 53% said employee training and empowerment was number one. Measuring employee performance (38%) and decreasing turnover (35%) also garnered a fair share of responses.  
 
As associates’ jobs get more complex, these three challenges are closely linked. After all, if associates don’t feel they have the information, tools and resources they need to be successful, that will have a significant impact on their loyalty to the brand and their overall engagement in their work. And let’s be real, there’s nothing worse than an uninformed and unengaged associate for your customers. As a result, respondents noted that they were leveling up their investment in training content and engagement programs. Top tactics include:  

  • Video training programs and educational classes (70%); 
  • In-person training sessions (69%); 
  • PDF documents and print manuals (58%); and 
  • Mobile training (57%) 

Year over year, Retail TouchPoints also saw more retailers invest in more innovative training approaches, such as VR- and AR-assisted training, online quizzes, and gamification. By investing in a combination of training tools and tactics, retailers can measure engagement, completion rates and knowledge retention to understand whether these methods are impactful for associates as well as customers.  

3. Product Merchandising  

More than half (56%) of respondents said their product merchandising budgets increased year over year. More than a third of respondents (38%) said this was a challenge, especially as it relates to managing their store-level workforce.  
 
Technologies mentioned throughout this piece, including associate-facing mobile technology, clienteling software, mobile-integrated digital signage and RFID all play into the evolution of in-store product merchandising and storytelling strategy. Associates only have so much time to dedicate to all the tasks they need to complete — and their priorities often lie with conversion-driving activities such as serving customers in-aisle and working through online orders for pickup.  
 
Visual merchandising and product displays play a critical role in creating a welcome and vibrant store aesthetic; shelves should be stocked and decorated to reflect the best of the retailer and its brand partners. If store operations leaders and managers don’t invest in product merchandising, then it can have a significant impact on dwell times, engagement, satisfaction and yes, conversions.  
 
We’ll be digging into these and other store operations topics during the 2024 Retail Innovation Conference & Expo through our Community Track. During these sessions, we’ll explore the evolution of the in-store experience, and how brands and retailers are investing in tools, systems and processes that empower associates and customers alike.  

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