“As retail businesses, when we look at numbers, they will seem worrying. But this is a temporary phase, and we will emerge from the COVID-19 crisis stronger,” states Mohammad A. Baker, deputy chairman and CEO of Gulf Marketing Group (GMG). “It is crucial for all retail businesses – especially small and medium enterprises (SMEs), start-ups and entrepreneurs – to regain the confidence that we are on the path to recovery. Albeit, we have to readjust to the new realities of doing business and move forward with confidence.”
The COVID-19 pandemic indeed sent shock waves across the region, as it did globally. The results are quite unprecedented – a month-long lockdown in the UAE, followed by a series of restrictions for a couple of months that are being lifted gradually.
“At the beginning of the lockdown, there was a lot of uncertainty around reopening of businesses – whether it could take 3, 6 or 12 months. People were uncertain whether life would go back to normal as we knew it pre-COVID until the discovery of a vaccine. However, three months since March, the UAE has managed quite well in reducing the COVID-19 positive cases, and the recovery rate is high. Businesses started reopening in phases since the end of April and now in full capacity, leading to positive sentiments. Currently, there is no age restriction around visiting the shopping malls,” Baker points out.
Also read: Retail businesses must recalibrate
Realigning business goals
Much before the pandemic, retail businesses had realised that online is an important channel. However, what happened in the past three months is an eye-opener, Baker states. “As retailers, we speculated that there would be a massive shift towards online from brick-and-mortar over the next five years. That shift got accelerated in the last three months. We have realised the importance of a robust IT infrastructure. Even though we have a strong IT infrastructure, it was not enough to ensure that all our staff could transition to working virtually, almost overnight. So, we strengthened that side of our business.”
GMG also ramped up its logistics infrastructure, opening its mega distribution centre in Jebel Ali Free Zone (JAFZA). What was supposed to be a 10-year long phased out process will now get completed within three years.
Baker also points towards the need to rethink customer experience. “I’ve been a fan of brick-and-mortar retail. But the crisis has prompted us to rethink how we can serve our customers better, adapting to their needs while bearing in mind health & safety requirements. How that will change the layout and look-and-feel of our stores – we are thinking about all these aspects.”
Even during the lockdown, GMG continued engaging with its own people and customers. From sharing COVID-related updates to creating videos and pledges, the group has done multiple initiatives to keep the communication alive. “Now, that life is slowly moving back to normal, and businesses have reopened, we are abiding by all guidelines issued by the UAE government to ensure the highest level of safety in our stores. From social distancing signage to increasing contactless, mobile checkout options, we have implemented several measures in our stores,” Baker states.
Sharpening omnichannel strategy
GMG was already forward-looking in its efforts to create a seamless retail environment. For instance, the Nike beacon store in The Dubai Mall opened a few years ago with mobile checkouts and other digital features in-store facilitating personalisation and engagement. In 2017, GMG started its e-commerce platform. Currently, the group has sharpened focus on its omnichannel strategy.
“Last year, we decided to migrate from our legacy system to Salesforce to sharpen our omnichannel strategy further. However, we were right in the middle of the migration when COVID-19 hit the region. During the lockdown, we started seeing massive traction on our e-commerce platform, which we were not ready to handle. We needed more time to plan for such significant online sales. The platform migration led to technical issues causing delays in delivery,” Baker shares. “But come September after we have migrated to our new platform, we will start offering a full-fledged omnichannel shopping experience to our customers. They will be able to buy online, pick up from store; buy in-store, avail doorstep delivery and so on. To ensure a smooth last-mile experience, we have partnered with specialists like Aramex, Fetchr and others.”
Looking ahead, Baker says 2021 looks “very positive” for GMG.
“Our immediate priority is to uplift the morale of our people to achieve positive results shortly. When the GCC countries were going into lockdown, as a business, we had to make strategic decisions around fixed costs at a time when there was no or minimal income. We have had to take aggressive measures to reduce costs, but we have done it collaboratively with our people. On the other hand, we upgraded the health insurance policy for our people, as that is crucial now. All these measures ensured that our people were excited to get back to work as movement restrictions eased, and we could quickly rebuild the momentum. The world is going through a pandemic, but life must get back to normal within a certain period. As retail businesses, we also have to operate within the ‘new normal’ without getting distracted.”
Will retail start seeing full recovery only around 2022?
A full economic recovery in the UAE would likely become visible towards 2022. And recovery will depend on things moving in a positive direction. “There will be a rebuilding period across all sectors, not just retail,” Baker concludes.
GMG is a family-owned business has introduced more than 90 international brands into the Middle East, while also creating much-loved home-grown brands.