The pampered consumer: The most common customer demands and how retailers can meet them
By Sean Rusinko, Global Director, Industry Business Leader - Retail & Hospitality at Sitecore
Today’s customer experience doesn’t begin or end with a visit to a store or a website. Customers shift between channels and devices depending on where they are and what’s convenient for them. In order to offer consumers exactly what they want, on the platform of their choice, brands are increasingly offering services such as personalised product offerings, discounts for loyal customers and subscription models. In part, this has been fueled by the ‘Amazon effect’, whereby popular online brands have set a precedent of using customer data they collect to offer personalised, quick, and consistent customer experiences.
On top of this, many consumers also expect their shopping experiences to be made as convenient and fun as possible, with brands there to support, advise and entertain them throughout the purchase journey.
Therefore, in order to acquire and retain customers, brands need to deliver against these expectations. Here, we not only discuss the five customer demands made of today’s retailers, but how brands can meet them and ensure they offer the experience that is desired.
Make it easy for me
Frictionless journey navigation, easy access to products and information, and lighting fast speed make for happy consumers who are more likely to purchase. According to the ‘The new retail ecosystem’ report from PwC, fair prices are the most important factor for customers when shopping offline, with 64 percent basing their purchase decision on a good price. However, when shopping online in particular, customers rank convenience as the most important factor. Therefore, brands looking to improve customer experience should make the online experience as convenient as possible, giving the shopper all the necessary information needed to make a purchase decision.
More specifically, the KPMG International Global Online Consumer Report found that the flexibility to shop when they want, the convenience of not having to go to a store and free shipping offers are all in the top ten reasons that consumers shop online. In fact, stores such as Walmart are using their brick and mortar presence to meet this demand. For example, in 2018 Walmart installed click-and-collect kiosks in 500 of their stores to offer quick, simple and convenient collection for customers.
Another convenience trend is ‘Try now, Pay Later’ services, which encourage consumers to try a larger assortment without having to pay upfront. For example, Sitecore customer ASOS use a ‘Pay Later’ capability, and Amazon’s ‘Prime Wardrobe’ gives customers seven days to try clothes at home and only paying for items they decide to keep.
As well as having the flexibility to collect their purchases from a store of their convenience (or have it delivered), consumers also expect to be assisted throughout the entire purchase journey. Many brands are meeting this expectation with personalised experiences, which includes individual product offerings, using data collected about each customer to tailor the messaging, offers and experiences each receives. And they are right to do so - research from Econsultancy found that 93% of companies see an uplift in conversion rates from personalisation.
Nemlig.com, an online supermarket in Denmark, has used Sitecore’s platform to personalise customer journeys, and has reaped the benefits. It uses customer data around product preferences and buying histories to personalise the front page, category pages, and search results for each shopper, and engages customers with individual messages throughout the site, via email and text messages. Since doing so, the number of site visitors has grown by 55 percent, the average basket size has increased, and turnover has risen by 28 percent.
However, it is also worth being mindful on how data is being used to target customers. The ‘Consumer Perceptions of AI Survey’ from Rocket Fuel found that while consumers are open to being targeted based on product interest, search and purchase history, they don’t want to be targeted with ads using their name, sent urgent notifications that a certain item is low in stock, or reminders to make repeat purchases of the same product.
The battle for winning brand-loyal consumers is extremely difficult, but the benefits are equally rewarding to the business.
PwC’s ‘The new retail ecosystem’ report found that more than 70 percent of people are staunch brand-loyal shoppers, and less than a third are willing to try new offerings. What’s more, many also respond well to loyalty programs and appreciate brands showing that they value customers.
However, it is no longer enough to offer a one-size-fits-all offering, such as the generic discounts or specific free products offered by brands in the past. Today, a personalised loyalty program, where different promotions are offered based on individual customer data and preferences, is needed to meet customer expectations. One company which has created a successful personalised loyalty program is Ulta Beauty Inc., which uses customer data to offer a wide variety of products to test, personalised birthday gifts and a tiered system of rewards based on levels of loyalty. As a result, 90 percent of its sales are now driven by loyalty program members.
Virtual and augmented reality (VR & AR) experiences are increasingly welcomed by customers. However, while in-store experiences such as VR mirrors previously just showed how customers would look in an item of clothing and were merely an entertaining addition to the in-store experience, they now offer added value and convenience to the customer.
For example, AR can allow those browsing online to visualise how a product will look on them before they make a purchase, allowing them to be better informed and removing the inconvenience of returning undesired products. L’Oréal has used AR and face mapping technology in its mobile app, allowing customers to try out different styles, such as hair colours, and lipstick shades, before making a purchase.
VR can also enhance the experience of using retail mobile applications. Fashion brand H&M is using its Image Search tool within the H&M app to allow consumers to upload an image of a similar product into the app. The app then presents several similarly looking, instantly purchasable items from the H&M catalog – moving the consumer closer from the moment of inspiration to a purchase.
Finally, consumers do not take what message a brand puts out there as fact – they base their purchase consideration on what everyone else has to say about the brand and its products. When Amazon pioneered and implemented ratings and reviews, their business transformed overnight.
One way to convince customers to choose your brand over others is through user generated content. In fact, research from Stackla found that 79 percent of consumers say user generated content such as product reviews and ratings both on the brand’s own website and on other listing pages, is highly influential in increasing their propensity to buy. Also, although social commerce has grown in popularity in recent years, with many consumers starting their search and even completing purchases on social channels, user generated content still remains more impactful than influencer content published on social media. In fact, according to Stackla, consumers find user generated content almost ten times more impactful than influencer content when making a purchasing decision.
In conclusion …
Today, customers are more demanding than ever, expecting an experience that goes above and beyond just the available products. In order to offer quality experiences, build brand loyalty and remain competitive, brands must consider these five main demands and put tools in place to meet them, from the use of effective personalisation to quick, reliable delivery services, through to providing loyalty programs and investing in VR and AR technologies.