Imagine a customer walking into a store, and the retailer already has information about the customer's requirements and preferences. The retailer knows everything about the customer and can promptly recommend the right merchandise. The retail industry is all about attracting and retaining customers, and retailers are increasingly focusing on achieving this.
The retail sector is the largest private industry in the world, with revenue generation of around USD 6.6 trillion. Many customer-based research studies indicate that consumers are loyal to their favorite brands and emotionally attached to their preferred stores. Traditional retail formats build successful relationships based on quality and thereby earn the trust of their customers. In contrast, modern formats have a contemporary look and feel, self-service options, and the availability of many products under one roof. However, it can be challenging for large store retailers to maintain a personal connection with every customer. As a result, there is a risk that a customer might move away from the retailer due to an unpleasant experience.
Reasons Why Customers Move Away from a Retailer:
A customer-based survey indicates that 96% of unsatisfied customers do not complain, and a vast majority of them simply do not return to the store. Every retailer aims to establish long-term relationships with their customers and hopes they will make multiple visits to the shop. To achieve this, retailers need to keep their customers satisfied by providing a delightful shopping experience. Gone are the days when only quality and price were the primary concerns of customers. Today, customers, in addition to considering product quality, also take into account various other factors.
As is the yearning of the retailer, customers too; prefer to establish long term relation with the retailer, and visit his store again and again. For this all they want is, an assurance from the retailer that, their favourite retailer is also thinking about them, appreciate, and is concerned about them.
Customer engagement Strategies:
Loyalty programs are a proven strategy for customer retention. This is used to up-sell and cross sell the product. Personalized campaigns targeting the customers will delight the customers, while bulk and impersonal communications fail to create the desired effect. Right communication at the right time, and using the right technology is a superior marketing practice.
Smart phones:
In today's world, smartphones have become as essential as wallets customers depend on them for everything from calls, to other services. Predicted to capture more than 75% of the mobile market by 2014, this trend shows no sign of slowing down. Smart phones, though basically are for calling; have capacitive touch screen, additional multimedia and computing features that places it close to a laptop. These hi-tech features enable customers to use smart phones for their shopping purposes. Retailers facilitate SMS facility helping the users to avail details regarding information and price of products listed online.
Tablets:
A survey reveals that 43% of the consumers spend more time with their tablets than with their desktop computers. Generation Y users who grew up playing video games tend to understand gadgets quickly. Tablets, though are similar to smart phones have additional capabilities; more resembling a laptop. Its Wi-Fi nature allows users to surf the web, and do shopping as well. Retailers leverage the ecommerce platform to market their products, ensure the customers with a superior and satisfactory online experience, thereby augmenting a stronger brand loyalty.
A new network launched puts a twist on the concept of e-commerce, which can be known as 't-commerce'. Computers at the Brick-and-mortor stores enable customers to check in and participate in customized loyalty programs. Customers need to type their loyalty card numbers, or can scan the image of their card with the help of the cameras on the tablet. Then they can check for discounts, coupons and special offers.
Social Medias:
Most of the retailers have online presence such as websites, email newsletters, social media accounts in Facebook and Twitter. The major advantage of social media is that it is free, and only needs someone to update information regularly. They can be used to connect with the regular customers. Retailers give a 'sneak peak' about the upcoming products and events to their customers. The customers will be able to access exclusive website content using the code they can see in the social media channel. Social media allows customers to speak with their retailers and brands freely. This expresses the retailers concern towards his customers. By making the customers happy, the retailers acquire repeated business and referrals.
Benefits of retaining existing customers:
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Gaining a new customer is five times costlier than satisfying the current customers.
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A company, on an average loses 10% of its customer every year.
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2% increased customer retention is equivalent to 10% cost cutting.
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Customer loyalty sometimes, even tend to increase over the life of a long term customer.
The success of a modern retail format is accomplished 50% with the right blend of brands. Remaining 50% of success is determined by how much the retailers focus in engaging the customers. With more and more brands, and retailers embracing customer engagement strategies, technology is a main tool in the retailer's armory.
References:
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How to win customers and keep them for life, Michael Leboeuf.
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Real-time Engagement, Images Retail, August 2012.
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