English - United States
The past few years have been particularly tough on retailers and 2019 looks set to be no different, with Business Insider last week reporting that a total of 5,300 US stores are set to close over the course of the year in what the publication is calling the “retail apocalypse”.
Household names like Abercrombie & Fitch, Chico’s, Gap, Family Dollar and JCPenney have all announced significant store closures since the turn of the year, following record breaking years for store closures in both 2017 and 2018.
The picture isn’t much rosier across the pond in the UK where, according to The Guardian, one in 12 high street stores have closed over the past five years. Poundworld, Maplin and Toys R Us have disappeared completely, HMV fell into administration for the second time in six years, and department store House of Fraser was sold to Sports Direct in a bid to save the company from collapse.
Much of the blame for the retail apocalypse has been placed at the door of ecommerce, with the likes of Amazon thriving, but stagnant salaries and high inflation have also taken their toll on consumer spending. The fact that online shopping has less of a foothold in mainland Europe has protected many of the large European retailers so far, but large organizations are certainly starting to get nervous.
If your organization was faced with making a tough decision - whether that be closing down locations, downsizing the workforce, or even selling to another owner - how well set are you to tackle the all-important internal crisis communications aspects of this?
Most organizations plan press releases and press conferences, they manage their shareholders, and they’ll create a detailed social media plan for downplaying the gravity of the situation. But your employees are actually your most important stakeholders and it’s essential all organizations have a plan in place for announcing news and managing employees opinions in the case of a crisis situation.
Can you reach all your employees immediately? Of course, bad news is best delivered face-to-face whenever possible, but industries such as retail and hospitality employ a large number of part-time or hourly employees who may only work one or two shifts per week but also deserve to be informed in real-time. This is where employee-friendly internal communications tools like an enterprise social network can really prove their worth.
Anticipate your employees reactions and questions. People feel scared or uncertain when told bad news and it’s only natural that they’ll have a lot of questions to ask, as well as wanting to vent their frustrations. Provide employees with a safe, easy internal space to do this and you’ll avoid the PR blowback of them doing this externally. You’ll also save your own time and energy by providing a single point of reference for these conversations so you don’t have to answer the same questions time and again.
Be up front and honest. Studies suggest that employees care more about being told the truth and being listened to than they do about their own ideas and advice being acted upon. It may be painful, but be 100% honest with our employees and you’ll minimize potential future fallout. Your honesty will also stop rumours - which can be painful and counterproductive - from rotting your organization from the inside.
Clarity is key. It’s fine to say “we don’t know” to some questions, but you should be clear and concise with your employees wherever possible. In particular, tell them what the next steps will be, when any major decisions will be made, and when and how future crisis communications will be made - maybe create a specific group within your company ESN, for example, to communicate and answer questions about this issue
Does it actually work? Once you have a plan, it’s time to test it! Make sure it works and you have internal clarity on all the steps and who is responsible for communicating to your employees.
Even if your business is not struggling, if you operate in a struggling sector like retail, for example, your employees are constantly reading bad news stories about closures and may be starting to worry for their own jobs. Given the impact that their income has on mortgages, healthcare, school fees etc, such worries can impact an employee’s happiness and, in turn, productivity.
Be honest with your employees; tell them if the business is doing well and be transparent if things are tight. Chances are they’ve already noticed the cost cutting but smart, proactive crisis communications can manage morale and even make employees complicit in the recovery. That extra discretionary effort that values, engaged employees deal out could be the difference between making it through a hard time and not.
It’s not all bad news for retailers and retail employees. While many traditional retailers - particularly fashion and footwear, sports and hobbies and electronics stores - are indeed struggling, there are a large number of retailers that are currently thriving, in spaces such as bakeries, book sellers, stationers, cafes, groceries and tattoo parlours. Pubs, bars and takeaways are growing too, while hair and beauty services are growing fastest of all across the UK.
The consistent theme between these seems to be that larger, mass-produced goods sold impersonally are moving online while smaller, niche and more personalized shopping experiences are growing their bricks and mortar footprint. Customer experience is a space where employee communications are also vitally important in providing a differentiated, loyalty-driving practice within locations.
But, for now at least, make sure that - whether the news is good, bad, educational or informational, you have a way to reach all your employees quickly and efficiently, and engage them in a two-way dialogue.
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