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Four Reasons Retailers Need to Invest In People

Ananda Chakravarty
Senior Analyst
October 30, 2017

Four reasons to invest in store labor

Labor was 43% of retail operating expenses based on our last US census data, but retailers haven’t been spending more on employee training [1].  A 2016 training industry report shows only 32% of those surveyed in retail are increasing their training budgets [2].  In addition, retail customers aren’t thrilled about associate help:   Forrester Technographics data shows that in-store shoppers prefer to seek help from devices over store associates for most in-store shopping tasks [3].  Physical retailers are looking for ways to contain costs as they grapple with lower foot traffic, the growth of online competition, and increased customer demands such as omnichannel fulfillment [4].  So, why should retailers invest in employees? Five factors compel greater investment in store labor:

  • Customers continue to shop in stores.  Eighty-seven percent of US retail customers are still buying in the store, with specific focus inside certain stores [5]. Customers continue to desire touching, feeling, and seeing beyond just snapshot product pictures taken in a bright light studio. Customer habits are shifting to place more importance on convenience in their shopping experience with cross-channel engagement such as in-store pickup [6].
  • People want to experience a store. Time, money and emotions help drive customers to the store. The emotional component of shopping plays a part in the drive to store engagement and purchase intent [7]. The customer is still interested in picking up their product on the way home (saving time), or finding lower priced items in the store (saving money), or even walking into a store to view things they can’t afford (status and emotional branding).
  • Before robots will come people. Associates will transition from menial and routine tasks to higher level store productivity – but this won’t be instant. The ongoing and unpredictable nature of store events makes it challenging for AI or robots to manage a store. Robots are assistants, not replacements. Retailers are exploring how robots can help associates focus on higher level tasks [8]
  • Associates are still your front line ambassadors.  Trained, equipped, and motivated associates can perform better and engage more effectively than those who aren’t, converting sales in the range of 15% to 40% in the store[9].

Read more about people investment technologies here:
TechRadar™: Digital Store Operations Technology, Q3 2016 (Updated),
TechRadar™: Digital Store Customer Experience Technology, Q3 2016 (Updated),
The State Of The Digital Store
The Future Of Jobs, 2027: Working Side By Side With Robots

[1] Based on US Retail economic data – US Census 2012.

“Out of 30 retailers examined, only 4 paid wages at or above the poverty level in the US. ‘The fact that so many companies do not pay above the poverty level aligns with … observation[s] that retail workers in general are disproportionately represented among recipients of public assistance’.” Source: “Retail Automation: Stranded Workers? Opportunities and risks for labor and automation,“ Cornerstone Capital Group, May 2017 (

[2] Source: Training Magazine November/December 2016 issue, page 33 (

Retailers are investing in technologies like associate enablement, mobile point of service, store task management, and in-store communication and wearables. See the Forrester report “Commerce Technology Investment Trends: 2017 To 2018” (

[3] Source: Forrester’s Consumer Technographics North American Retail & Travel Online Benchmark Recontact Survey 1, Q3 2017 (US).

[4] See the Forrester report “Retailers Are Off The Starting Blocks Of Omnichannel Commerce” (

[5] See the Forrester report “Surprise – Retail Is Growing! Here’s What It Means For Digital Businesses” (

[6] See the Forrester report “Omnichannel Mastery: Optimize In-Store Pickup” (

[7] Review the Forrester report “Emotions Fuel Your Brand Energy” (

[8] Examine the Forrester report “The Future Of Jobs, 2027: Working Side By Side With Robots” (

[9] Conversion rates vary depending on industry, store and a variety of sources. Compiled sources include:
Interviews with Euclid Analytics, Aptos, RetailNext, Shopadvisor, IBM, Swirl, Manhattan Associates, Tyco Retail Solutions, et. al.


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