What’s the Story?

Store associates are highly valuable assets for retailers as they are pivotal in shaping the in-store shopping experience. Poorly trained staff can easily translate to unmet shopper expectations, which puts retailers at a risk of losing market share and deteriorating brand loyalty. In this context, it is essential for retailers to train their store staff to meet the needs of today’s tech-savvy shoppers, who expect service to be immediate and part of a seamless shopping journey, as they experience via the online channel. This report forms part of our Innovator Profile series, which focuses on emerging technologies that disrupt traditional retail and fuel innovation across the retail value chain. Coresight Research collaborated with each covered company to offer insights into their business model and offerings. In this report, we profile Mark Innovation, a provider of technology and communication applications to businesses that help meet the needs of clients’ digital-age audiences.

Why It Matters

The Covid-19 pandemic has put retailers under unprecedented pressure to innovate their online and in-store offerings. Although retailers have been successful in introducing newer technologies and services, there is still a gap to bridge when it comes to optimizing the in-store shopping experience. There are three main reasons why we believe that the use of digital technologies to train store associates is imperative for success in brick-and-mortar retail:

• The bar for customer engagement has been raised—Store associates are the first human touchpoint of the in-store shopper experience, directly impacting their perception of the brand/retailer with consequences for sales conversion. With increasingly connected and digitally empowered shoppers, retailers must invest in training their store associates to meet consumer expectations: Consumers increasingly expect service to be immediate and part of a seamless shopping journey, as they experience via the digital channel. Today’s shoppers have a wealth of information available to them online, so store associates must be held to higher standards of knowledge to add value to the brick-and-mortar experience. More than five in 10 consumers believe that companies need to transform how they engage with them, according to an April 2019 survey of 8,022 consumers worldwide, conducted by Salesforce.
• Store associates lack the digital punch—Using mobile devices can help store associates service customer requests such as processing returns and checking inventory in a time-effective manner. However, only 59% of frontline workers use mobile devices in their job, according to a December 2020 survey of 1,000 frontline workers in Canada, the UK and the US conducted by digital solutions provider Yoobic.
• The state of training needs to be revamped—In the current fast-changing environment, it is essential for retailers to continuously upskill store associates. However, employee training has not kept pace with the increasing importance of the role: 40% of frontline workers are trained only once a year or less, according to Yoobic’s study.

Figure 1. Key Statistics Underlining the Scope for Improvement in Training Store Associates [caption id="attachment_127291" align="aligncenter" width="720"] Base: 1) 8,022 global consumers surveyed by Salesforce in April 2019; 2) 1,000 frontline workers from Canada, the UK and the US surveyed by Yoobic in December 2020
Source: Salesforce/Yoobic[/caption]  

Mark Innovation: In Detail

  What Problem Is the Company Solving? Mark Innovation offers digital learning solutions in short interactive videos to a wide array of industries such as construction, hospitality and retail. Mark Innovation helps retailers empower their store associates through modernizing traditional—text-heavy and non-interactive—computer-based training, which does not hold the attention of users in today’s digital age. Through modern digital technologies, Mark Innovation helps retailers equip their store associates with essential knowledge and skills for improving the shopping experience. In addition, Mark Innovation’s micro-learning approach—short and interactive content—can assist in conducting training for an already stretched workforce. Figure 2. Traditional Approach Versus Mark Innovation Approach to Associate Training [caption id="attachment_127293" align="aligncenter" width="720"] Source: Coresight Research[/caption]   The company offers solutions to three key challenges that retailers face, as we discuss below. 1. Lack of Regular Training On-demand digital training modules can help retailers overcome the problem of ineffective and irregular training. Retail store associates manage multiple tasks in addition to attending to shoppers, such as processing returns and stocking shelves. Conducting regular training on managing daily activities is not a financially feasible option for retailers. In fact, the retail industry has the lowest rate of conducting regular training (52% for overall retail and 50% for grocery retail) among selected industries, according to an August 2020 survey of 2,000 frontline workers from Australia, the UK and the US conducted by digital training platform Axonify. Figure 3. Frontline Workers Who Receive Regular Training, by Industry (% of Respondents) [caption id="attachment_127294" align="aligncenter" width="720"] Base: 2,000 frontline workers from Australia, the UK and the US
Source: Axonify[/caption]   2. High Employee Turnover in the Retail Sector A digital, on-demand and targeted—shorter video training—approach to training can help retailers train their employees as soon as they join and adds flexibility to quickly make changes to the training modules. The retail sector is plagued with one of the highest staff turnover rates. High employee churn can add to the burden of training employees as it involves both cost and effort. In this context, it may not be financially feasible for retailers to use traditional training methods such as in-person on-the-job training or centralized training. The separation rate—the ratio of employees who are no longer on the payroll to the total number of employees—was 4.9% for the retail sector in February 2021, according to the US Bureau of Labor Statistics (BLS). This compared to 3% in manufacturing, 2.5% in educational services and 2.1% in the finance and insurance sector (see Figure 4). Figure 4. Selected US Industries: Separation Rate, September 2020–February 2021 [caption id="attachment_127295" align="aligncenter" width="720"] Note: Separation rate does not include employees who retired or those transferred to a different location
Source: BLS[/caption]   3. Disconnect Between Store Teams and Headquarters Mark Innovation’s solutions enable retailers to build interactive learning repositories that ensure the effective use of all available technologies. This digital approach supports a more connected environment between retail headquarters and store employees and ensures a direct line of communication between upper management and individual store teams. Retailers must communicate instructions clearly from headquarters to store associates to ensure that changes to the store layout and planograms are implemented in real time. In addition, it is important for retailers to provide their store associates with easy-to-understand instructions. However, there is a disconnect between retailers’ headquarters and their in-store team. According to a recent Coresight Research survey of 180 global retail merchandising decision-makers:

• Some 45% of respondents cited lack of clarity in communicating instructions as the “topmost challenge” (ranked first, second or third) in retail merchandising execution.
• Around 29% of respondents cited the use of manual paper-based processes as the topmost challenge.

Company Offerings Interactive Video Training With the help of interactive and first-person video filming, Mark Innovation enables retailers to conduct scenario-based training for their employees. The videos simulate the in-store experience, presenting the outcomes of different approaches to a single problem. This helps store associates build a better understanding of the responsibilities involved in their day-to-day job and the consequences of their decisions and actions. This micro-learning approach to training is very agile and fast, according to Mark Innovation. [caption id="attachment_127296" align="aligncenter" width="720"] A simulation-based video training where the viewer learns about the role of a pay station inside the store
Source: Mark Innovation[/caption]   Certification Programs Mark Innovation’s Certification Programs provide certification upon completion of required training modules for a specific role. In addition, it offers scheduling flexibility to store associates, who are able to learn and develop their skills at their own pace. Retailers can build certifications according to their company goals, and the program can also help them align their goals with those of their associates. Tracking and Analytics Mark Innovation’s tracking and analytics features help the training and development teams evaluate individual performance and progress on the training modules. Furthermore, access to training-completion analytics can help companies improve their decision-making on whether an employee is a good fit for the role. Knowledge Library Mark Innovation’s Knowledge Library allows retailers to bridge the gap between the headquarters and the stores, as well as between stores. With the help of the Knowledge Library, retailers can gather necessary information in a specific location that can be readily accessed by store associates. The Knowledge Library can help retailers overcome location silos among stores by sharing individual success stories or new methodologies. The solution increases operational efficiency of individual stores and helps retailers achieve greater employee engagement, according to Mark Innovation. Competitive Advantages Below, we outline three key competitive advantages of Mark Innovation.

• First-person filming ensures higher employee engagement and a better understanding of the problem. First-person filming improves the decision-making capabilities of store associates when they come across similar situations on their job.
• Simulation-based learning helps store associates develop the right set of skills and understand the outcomes of incorrect decisions. This training methodology enables retailers to cover multiple possibilities that their store associates may come across.
• Speed and agility of micro-learning or “just-in-time training” helps retailers train their store associates on important technologies and roles using small, targeted videos. This helps overcome the challenges associated with long on-premises training.

What We Think

There have been substantial shifts in the retail sector in the past 12 months—including a surge in e-commerce, the widespread introduction of innovative fulfillment methods and the proliferation of digital payment options—which have resulted in the increased adoption of advanced technologies by brands and retailers. However, the uptake in technology has not been matched by the upskilling of store associates, and the implications of this imbalance may surface when store traffic returns to pre-pandemic levels. Currently, the limited available training for store associates—which is traditionally computer-based and non-interactive—can lead to asymmetric information between traditional store associates and modern tech-savvy shoppers, which has negative impacts on sales. Leveraging digital technologies can help retailers to overcome some of the challenges associated with traditional training methods and ensure real-time knowledge transfer between stores.