With today’s customers able to access rich sources of product and service information – especially pricing data – when they are mobile, retailers are being forced to innovate in the way they capture consumers’ attention. Unfortunately, attention spans are rapidly decreasing to just the few seconds that a user spends on any one page before swiping or switching.
In the past, for many retailers it has been a race to the bottom on price or discounting in order to win and get the increasingly savvy shopper to convert and purchase with them.
Some retailers are finding ways to lock in customers without the product price being the only issue – recently illustrated by Amazon Prime’s extension of benefits and expansion into the grocery sector.
I was shocked at the number of Internet shopping-savvy friends that have told me a trick they discovered to get a discount on their likely purchases. They simply place items in the basket, give the retailer some basic details like email, and sit back and wait for the email or message with a discount code before completing their purchases. They even follow the process with multiple retailers to see who gives the best discount!
Meanwhile there is growing hype about how retailers need to develop more personalised shopping experiences, and deliver that direct one-to-one interaction with customers, no matter how they shop or browse.
Before retailers rush ahead with finding ways to personalise more and more customer touchpoints, they should take a leaf out of the books of organisations like Shop Direct, which has been strategic with its personalisation plans. Consider that the rich stream of analytical customer insight can be used to make the customer experience so much more relevant, whilst at the same time making it commercially relevant. For example, why offer the same discounts or promotions to your occasional and least profitable customers, as you do to the very frequent and high profit driving group?
Another aspect of improving customer experience and staying ahead of competition, is that it costs more to do so, and often it’s the same sale you might have got through traditional channels. Therefore it’s increasingly important to model the commercial impact of your new service and decision ahead of roll out.
Investors are starting to note that previously brick-and-mortar reliant retailers which are growing their online or omnichannel sales, tend to require more financing than those online-based retailers which don’t incur these extra costs to sell. Services such as free shipping and returns, supply chain handling in click & collect, or central customer services to smooth the customer experience, are all additional processes that need to be funded in order to deliver the experience today’s consumers are demanding.
Retailers have all the data they need to analyse and model their way through the new norma, where being relevant to each and every customer means getting the basics in place. Consumers want transparent availability of products and stock at store, and are starting to expect retailers to predict what that customer is most likely to need next, balanced with all their preferences evident from previous purchasing behaviour delivered in a timely, often instantaneous manner. However retailers still need to be focused on turning a profit, and to remain relevant in their role between manufacturers and consumers.
Find out more about what retailers need to do to better understand the customer and still make the right commercial decisions.
