With the rise of ecommerce and smartphone shopping apps, consumers don’t even need to leave their house to get what they want. That’s why brick-and-mortar retailers have to give them a reason to make the trip – to make them want to visit the physical store. Retail stores can do this by creating an atmosphere that caters to consumers’ personal preferences.
1. Why consumers expect better experiences
We’re part of the “experience economy.” Changes in technology have influenced changes in culture, which in turn have shifted consumers’ expectations. In this day and age, consumers expect retail stores to provide them with more than just products – they want a valuable experience that can’t be recreated online.
In fact, 86 percent of consumers will pay up to 25 percent more for a better customer experience according to a RightNow Customer Impact Report.
So when did this shift start? Experts have been speculating about it for several years (the term “experience economy” was actually coined in 1998). The theory suggests that retail businesses should offer consumers a memorable experience rather than a simple product or service.
Not to mention, brick-and-mortar retailers need to create good experiences for their customers because they can’t afford bad ones. Let’s face it – retail was a highly competitive industry before adding new technologies into the mix, and ever since ecommerce and mobile commerce have gained ground, brick-and-mortar retailers have been fighting to remain profitable. Traditional retail business models have dissolved and traditional outbound marketing methods no longer work.
To sum it up: research shows that there is a need for valuable in-store experiences. A 2013 study from WD Partners reports that 75 percent of consumers say retail stores offer a sensory experience and immersion into the product that can’t be matched by online retailers. They’re looking for quality customer service and customer loyalty incentives.
2. Why personalization is the answer
Infosys reports that 78 percent of consumers are more likely to be repeat customer if a retailer provides them with targeted personalized offers. And on the other end, the CMO council reports that more than half of consumers consider ending their loyalties to retailers who do not provide tailored, relevant offers. Your brick-and-mortar customer base is your foundation, and you don’t prove to them that you value their business, it could crumble.
For example: they want to receive promotional emails with their first and last names on them, and when they open them, they expect to see a relevant offer based on their demographic or purchasing history. They also want to participate in loyalty programs that keep track of their purchases and accrued points so that they can achieve a certain level or status.
And they’ll pay for it. Eighty-six percent of consumers will pay up to 25 percent more for a better customer experience, according to a RightNow Customer Impact Report.
3. How to deliver it
In some ways, advancements in technology have worked in brick-and-mortar retailers’ favor. With state-of-the-art POS systems and software, retailers can take advantage of business analytics and reporting features that allow them to deliver personalized offers.
To begin, collect each customer’s name and email address by inviting them to participate in a free loyalty program that will send them weekly coupons and deals. For even more personalization, ask for their age or zip code. This can be entered right at the POS terminal as they check out, or they can enter this information themselves at a self-service kiosk.
From there, track their purchasing history. You can also analyze sales data from your POS system to learn more about your customer base as a whole. Finally, segment your email lists by age, location or buying preference to deliver targeted emails.