Upon hearing the word Christmas, most people’s minds conjure up fond memories: the smell of pine, the sight of presents glistening like unopened candies under the tree, the taste of Mum’s glazed ham and Grandma’s famous pavlova. For retailers, it’s a slightly less joyful affair. To them, the thought of Christmas involves numerous worries. Do I have enough staff to deal with the Christmas rush? Is the marketing I have in place going to effectively bring in customers? How am I going to ensure everyone gets paid the correct amount on time? Luckily, the experts are on hand to advise on the dos and don’ts of this jolly time of year.
Hiring and training
There’s no doubt that the lead up to Christmas puts enormous pressure on retail staff.
The sight of frosted glass and Christmas baubles appearing in shop windows may warm the cockles of their hearts initially, but that joy will fizzle if they’re unprepared for the onslaught of shoppers.
What’s more, shoppers can often be tougher to deal with at this time of year.
In they trek, often with an unhappy child or two in tow, teeth grit in determination. They’re stressed, under pressure to find the perfect gift and will hunt for it at the expense of badgering a fatigued shop worker.
If Christmas in retail were a battlefront, your staff are the frontline soldiers, ready to don the armour and deal with any blows that may come their way.
Co-founder of retail training company RedSeed Anya Anderson says the key to preparing staff for battle is planning.
She says retailers need to talk with their staff about what changes Christmas brings, and what they mean for each person’s role.
This discussion could cover anything from how many people should be in a queue before another register is opened; whether a store has enough fitting rooms; who’s going to deal with extra stock; and whether staff need to pick up extra hours earlier or later in the day.
“Once everyone knows what’s coming up and what the plan is, it gives people confidence and relaxes them,” Anderson says.
The other side to this is ensuring staff are well looked after in peak shopping times.
If a worker is visibly stressed or exhausted, retailers need to ensure they’re taken care of, she says.
“It’s about having strategies for making sure staff can get off the floor and have enough water. If people are getting frazzled, give them opportunity to have a five-minute break and take a walk around the mall or the block.”
With the increase in customers also comes a need for staff to adjust their behaviour, Anderson says.
While staff may have been able to take their time with each customer they served throughout the year, at Christmas they’ll have to change their processes to keep up with demand.
“It’s important to give as many customers through the door as possible a sense of being helped. If you maintain the same time frame you’ve had throughout the year with each customer, you’re going to run out of time,” Anderson says.
She says the good news is that generally speaking, customers are less resistant to a sale around Christmas time, which means the shop assistant isn’t under as much pressure to close the deal.
“People are more inclined to buy when it’s busy and there’s a time frame, like Christmas coming. They make decisions more quickly,” she says.
As for hiring and training new recruits, there’s a couple of key points retailers should remember.
When it comes to Christmas crunch time, there’s often not a lot of time free to train casual staff brought on board. Instead, they’re sent straight out into the battlefield – and often without so much as a training course to shield them.
Anderson says it’s important to give casual staff members some training. However, there are a few tricks for getting around a lack of depth of knowledge.
“Hire someone who is full of energy and a good self starter, because passion will always override training if you don’t have time to fully train them,” she says.
Another tip is to train a worker in one area and have them specialise in that particular role.
“If you’ve got limited time to train people, train them on the till and have them only on the till, or train them on the floor and have them only on the floor,” she says.
Overall, she says retailers should hone in on three areas with their staff training for Christmas: till efficiency, security and customer service.
“People don’t mind standing in queues but they hate standing in queues that aren’t moving because somebody is being inefficient,” she says.
“With security, it’s concentrating on covering your store floor really well and with customer service, again, it’s understanding how to give most customers a feeling that they’re being helped.”
Payroll and accounting
Alongside the carols that dominate stores from November onwards is the buzzing and whirring of items being scanned and sales being made.
There’s nothing like the build-up to Christmas day to keep the tills ticking along, but with that increase in returns comes a need for more staff – and better money management.
MYOB head of SME solutions Ingrid Cronin-Knight says first things first, it’s vital retailers get their employee contracts right when hiring new staff over the Christmas period.
“When you’re dealing with a transient workforce, there’s quite a bit of complexity setting up employee agreements, ensuring they get paid well and ensuring they pay the Government,” Cronin-Knight says.
One thing for retailers to keep in mind is the that the laws surrounding employee contracts have changed from last year.
“Zero [hour] contracts are a thing of the past, so usually in a contract you’ve got to set up expectations around leave, hours that will be worked, what holidays will be given and once that’s set up and agreed upon, you can put that into a system,” she says.
Once all of that information has been clearly articulated to both parties and entered into the payroll system, then the right deductions and pay can start being made.
Cronin-Knight says having a good payroll system in place helps to automate processes like tax deductions, salary and wages.
This may be a particular pain point SMEs, she says, as larger retailers generally have payroll administrators whose sole job is to manage payment matters.
“When you’re a smaller business and you’re part-time managing it, it’s more challenging when you’ve got less dedicated resources.”
She says when retailers have an efficient system in place, they can free up a significant amount of time for other matters.
“Typically, what we find is people save at least 40 percent of their time when they start using good pay software, which in peak times can be a godsend,” she says.
“You could even go a step further if you want and outsource payroll processing so you don’t have to worry about it.”
As well as having a more smoothly run operating system, a good payroll provider ensures good retailer and employee relations, she says.
At Christmas time there’s a lot of variables at play with employees’ pay that can make it more complex, such as leave arrangements, overtime and time-and-a-half.
Getting any of this wrong can leave employees distressed, she says.
“Nothing upsets an employee more than when their pay’s not right,” Cronin-Knight says.
“For employee satisfaction and retaining talent, it’s important to set those expectations right up front, and software helps you take care of all that.”
When it comes to managing employees, she says retailers should think about them in the same way they think about stock.
In other words, nothing should go under the radar. Everything needs to be tracked and logged within a system that can be readily accessed with ease.
“They [retailers] need to be disciplined about managing their workforce and keep track of how many hours are worked, leave arrangements, KiwiSaver – keeping all those personnel files in one place is very important,” she says.
The other pain point over Christmas time that the right software can help with is cash flow.
Just how much stock is going to fly off the shelves over this period is often hard to predict, yet retailers need to try anticipate how much will sell and budget for it.
Payroll systems are now advanced enough to help with stock management and predict problems retailers may run into at busy times.
“With accounting software, you can forecast your budget ahead of time and anticipate cash challenges you might have and do some risk assessment,” Cronin-Knight says.
This means if there’s not enough people coming through the doors or stock isn’t moving, retailers can track this data and be alerted to it in real time.
“You can get reports daily and see how your cash flow’s tracking, what your performance was like the day before and live transactions.”
The staff are in place and properly trained, all the right information has been logged and the risks assessed, but now you need to ensure customers are drawn into your store.
The most practical way to do this is through marketing offers to your database, and one of the most effective ways to reach the busy, modern-day consumer is through email.
Regional director of the Asia Pacific region for global email marketing automation vendor dotmailer, Rohan Lock, says the strength of email marketing is there’s a direct conversion or correlation with retail sales.
Emails can be timed and sent out based on when someone is more likely to open the email, or looking to purchase something.
However, the only problem is that every other retailer around the country has the same idea – and they’re firing out their own Christmas-themed emails to their customers with that festive pun you thought was a winner in the headline.
Lock says there’s going to be a lot of white noise out there in people’s inboxes for retailers to cut through, but that doesn’t necessarily mean you should cut back or increase how many emails you’re sending out.
“I think the first thing retailers do is they reduce their emails or ‘batch and blast’ them. The first rule is don’t batch and blast them, plan ahead. Be smart, be relevant and be personal in your approach,” Lock says. “Content is going to be king.”
“Always monitor your unsubscribe and complaint rates, but sending more emails will make you more money. We can show the correlation between the two time and time again.”
To ensure the content fits to the person on the other side who’s going to be reading it, Lock says you need to understand their motivations.
Generally, he says customers are motivated to buy products by three key points: discounts, deadlines and last-minute scarcity.
With discounts, it’s looking at how you can reward your best customers by giving them exclusive offers or reminding them they’ve got rewards points to spend in-store.
With deadlines, it’s looking at increasing the frequency of emails and getting the timing right.
Christmas is the biggest shopping deadline of the entire year, so Lock says this looming event should be emphasised to customers.
“The closer to Christmas, the more people are running out of time so you want to be top of the inbox with deadline offers and making sure people understand when the last day is that they can get things delivered,” he says.
The closer it gets to the day, the more worried people are that their online purchases won’t be delivered in time.
This is why click-and-collect pickup options or vouchers to spend in-store are helpful to include in emails.
They encourage people to visit your physical shop, Lock says, and they might do some additional spending while they’re there.
“When they come to the store, it’s a great chance to put the click-and-collect area at the back and make them walk through on the chance they might pick something extra up.”
Alternatively, if customers are ordering off your website and choosing to have the item delivered, he says it’s important to give them confidence that the gift is going to arrive in time.
This can be done through emails tracking the parcel’s whereabouts, or a follow-up email advising when it’s likely to arrive.
The other factor that influences sales is scarcity. When customers see items are running out of stock, Lock says it creates a sense of urgency and makes people afraid to miss out.
He says UK department store House of Fraser is a great example of this, as it included blacked out products that had sold out in its emails next to items that were still available.
However, this is a sales technique that should be handled with care, as it can backfire.
Lock says stock levels must be accurately monitored, as if customers are clicking through to try to buy a product that’s not there, it’s a waste of time.
“That’s a big mistake that’s made quite often and people bounce at that point. It’s annoying if you’ve made that investment.”
With these factors in mind, it’s important to note what promotional days emails can be themed around.
Christmas and Boxing Day sales aside, there are now various days around Christmas that are a sales opportunity, including Black Friday and Cyber Monday in November.
Each has different motivations for consumers. Lock says Black Friday and Cyber Monday are about selling directly to the end user as well as gifting, while Christmas is about gifting and Boxing Day sales is about selling.
To ensure these emails are personalised to customers and stand out from the crowd, data can be a huge help.
Lock says data can be gleaned by looking at what customers have already purchased in the past, their browser behaviour and their email behaviour.
Christmas is also a good time of year to make sure you’re getting the most out of the higher rates of traffic to your site, he says.
“How do you leverage that traffic? To me, it’s making sure people are signed up to your newsletters and having a pop-up or something that incentivises them to sign up to your email campaign.
“Make sure the ‘sign up to the newsletter’ button on your website is prominent, like at the top of the page this time of year. It’s peak time, so it’s peak time to build data and build the profile of a customer.”
Mailer software like dotmailer’s can track retail customers’ browser behaviour before they’ve committed to buying something or given their email address.
Once that information is added, the customer profile can be fleshed out even more through competitions and surveys and used to create more personalised email campaigns.
With all this said and done, there is such a thing as customer email fatigue. It’s important not to wear the buyer out by bombarding customers with emails that are only trying to sell, sell, sell.
Lock says this is where a bit of variety helps strengthen the customer-retailer relationship.
“At some point, it’s a good idea to make it a bit more fun and light-hearted by changing it up and sending a poll or survey email,” Lock says.
He gives the example of sending out an email polling customers on the best and worst presents they received, post-Christmas.
“It’s important to come full circle and remember once they have bought something, we should be mixing up the email communications a little bit.”
Other festive factors to consider:
Music: Do your customers and staff really want to hear Michael Bublé’s Christmas album on loop for the fourth year in a row? Now that platforms like music streaming service Spotify exist, there are no excuses to play the same songs repetitively when there are countless playlists, albums and artists available. There’s even a free Christmas radio called Tinsel and Tunes which broadcasts rock, pop, jazz and classical Christmas tunes from 1 November until 1 January. Mix it up a little and save staff from wanting to run away every time they hear Bublé’s rendition of ‘It’s beginning to look a lot like Christmas.’
Visual merchandising: One of the most important things to note when it comes to decorating a store for Christmas is that the shopper isn’t going to be the end user, they’re going to be one gifting it. Because of this, retailers need to consider that their Christmas clientele may not be the usual crowd frequenting their stores, and plan the look of their shopfront accordingly. Retail commentator Bob Phibbs reckons retailers should be rolling out the decorations as early as October to reel in shoppers, seeing as consumers – particularly Millennials – are more frugal these days. In terms of inspiration, photo sharing site Pinterest has thousands of boards dedicated to Christmas décor and store front ideas.
Consumer behaviour: TRA head of strategy Colleen Ryan says when it comes to consumer behaviour, Christmas works in retailers’ favour as it is a natural disrupter. For most of the year, she says people shop on auto pilot and stick to well-trodden pathways and habits. But Christmas means they have to go hunting for items they wouldn’t usually purchase. “Breaking habits causes us to engage our brains to think and appraise, not just grab and forget. So we tend to look at things we don’t normally see. Retailers can use that break in patterns to influence purchase behaviour,” she says. Consider it a chance to engage customers you might not normally engage, or to spruce up parts of the store some people might not normally visit.
Another tip Ryan has to influence customer behaviour is telling them what other people are buying as gifts. She says this can be an effective sales tactic around Christmas time, as it’s a one-off event that has high emotional importance, so no one wants to get their gift choices wrong. “They [customers] are looking for reassurance that they are getting it right. Christmas is also a ritualised event steeped in cultural traditions, making social endorsement part of the emotional reward – why would we stress and work so hard at it otherwise?” If someone’s struggling to pick an item for their loved one, try offering advice on what other people have been buying for their friends and family.
Top picks for presents: Developments in technology have created all new ways to track consumer spending trends for Christmas. Tools like IBM Watson analyse millions of conversations online and forecast products that’ll be popular. You can peruse what it’s picked as the top trends online at IBM Watson Trend – there’s even an app available. At the moment, Lego Star Wars sets are a frontrunner as a popular purchase. For some international guidance, Toys ‘R’ Us and Walmart have also released their top picks for Christmas presents in 2016 and they include Hatchimals, DreamWorks Animation’s Troll dolls and the Pokemon Z-Ring.
This story originally appeared in NZ Retail magazine issue 746 October / November 2016