OrderWise in February 2021 - v21.02
Discover what OrderWise testers and developers have included to make...
With this month marking the start of a new financial year for many businesses across the UK, it is no surprise to see numerous reports released in the last few weeks highlighting both the good and bad commercial performances from over the last 12 months. The retail sector once again came under the spotlight, with PwC research released this month showing that 2018 saw Britain’s top high streets lose a staggering 2,481 shops – with an average of 16 stores closing per day over the course of the year throughout the country. No doubt this is a result of both an increasingly testing economic climate, as well as a tactical move by top retailers to switch their focus to a more online-first sales strategy. However, although 2018 unquestionably proved a difficult time for many retailers, the first quarter of 2019 seems to have brought about a much brighter outlook, in more ways than one. With a scorching Easter Bank Holiday weekend just gone, the hotter climate is good news for retailers as a recent study suggests consumers are much more willing to spend in the warm weather.
According to the IMRG and Capgemini eRetail Sales Index, the unexpected warm weather in February (including the hottest February day on record) begun to revitalise in-store retail sales as the industry recorded its strongest growth in six months. What’s also encouraging is that although the warm weather encouraged both online and offline trading, Strategy and Insight Director of IMRG, Andy Mulcahy, explained that “those with a high street presence recorded a rate of online sales growth almost three times greater than their online only counterparts.” This reaffirms that, despite a gloomy 2018, there is still very much a place for the high street store in an increasingly omnichannel dominant market.
So, with the next bank holiday weekend just around the corner and the summertime fast approaching, we thought we’d analyse what retailers can do to make sure they capitalise on the extra sales potential that this warm weather seems to be bring.
Delivering an excellent customer service experience that keeps buyers returning may seem like an obvious one, but it is an area where businesses are increasingly falling short. According to Forrester’s customer experience index rankings, UK’s major consumer-facing brands have been dubbed as “mediocre” with a staggering 86% voted as delivering just an OK customer experience. With this being the case, becoming a customer service champion and delivering an exceptional buying experience is going to be key for any business looking to stand out from the competition.
So, to drive better customer service, what is it that businesses should be focussing on? And more significantly, what is it that customers want? To understand this, retailers need to keep in touch with changing consumer behaviours and the expectation for greater synergy between both online and in-store sales channels.
With online and mobile shopping meaning consumers are now able to make their buying decisions at any time, getting the right product price point is vitally important for converting any potential buyers.
Purchasing decisions can often rely on how closely in-store prices match those online – for example a customer who browses in-store at a product may find themselves later looking at the same product at a cheaper price online, causing them to price check against other brands before making their final decision. On the flip side, customers may find the product they want online only to find a different price when they go to their local store to complete the transaction. Therefore, ensuring that pricing is mirrored enables retailers to capture more sales as customers are presented with consistency, regardless of whether their initial interest or final decision comes from an interaction made online or in-store.
In addition to pricing consistency, businesses should also consider the checkout process. From time to time, shopping baskets can be found abandoned online as businesses don’t offer a payment or delivery method to which the customer is accustomed. This same issue is also hitting high street stores, with many consumers demanding in-store payment technologies that replicate the convenience of a “one-click” online checkout. According to a recent OnePoll survey, 52% of UK shoppers said self-checkout and scan-and-go capabilities in-stores would improve their customer experience. Therefore, it is important that businesses fulfil customer expectations by delivering a checkout process that delivers speed, choice and convenience to the end consumer, regardless of whether they are buying online or in-store. This can be achieved through a greater focus on queue-busting till technologies, a flexible range of payment options across both channels and the offering of delivery services such as click and collect or endless aisle ordering.
By catering to these consumer demands whilst fulfilling pricing expectations, businesses will be able to ensure they make the most of any warm weather traffic, capturing more sales through delivering a seamless omnichannel buying experience.
Another way in which businesses can get ahead and win more sales is the offering of a more personal touch. Personalisation in both sales and marketing strategies is a sure-fire way for customers to gain the edge over competitors, as it allows businesses to target customers based on their individual interests and buying habits. This in-turn allows them to achieve a higher conversion rate because of the greater relevancy in communications and discounts.
With this being the case, some retailers are going above and beyond to deliver a more personal experience through cutting-edge technology. Engaging customers through AR and VR has already seen breakthroughs, with IKEA one of the globally recognised retailers using this technology to create a more personal experience, allowing customers to imagine how furniture would look in their home before they make their purchase. Now according to research by Gartner, 100 million consumers are set to use AR and VR technology when shopping by 2020, with this technology set to see a rapid uptake amongst other large retailers in the coming 12 months.
Now although AR and VR might not be an immediate consideration for some businesses, improving the customer experience through more personalisation should be at the forefront of any business strategy for the new financial year. In the same Gartner study, it is predicted that by the end of 2019, around 50% of retailers will have redirected their investments towards customer experience innovations.
Therefore, to avoid falling behind competitors, businesses should look at smart, cost-effective ways they can better personalise the customer experience. This can be achieved through things such as RFMA or Business Intelligence tools, that offer insight and analytics into what customers are buying and where they are spending their money. From this data, businesses can then target relevant product offers at the right customers in their email marketing, creating a more personal approach that helps drive more sales.
If consumers are willing to buy more in warmer weather, then retailers need to make sure they are rewarding this customer spending. Retailers will tell you that identifying and rewarding the most valuable customers can help shape brand loyalty and aid retention.
Although free gifts and exclusive discounts are tried and tested methods of engaging customers, a recent survey has found that loyalty schemes seem to generate the best results. According to Marketers’ View, the latest research on customer engagement in 2019 found that 77% of consumers like being given loyalty points to use, with 54% of marketers surveyed also choosing this type of reward as being the most effective.
Whether it’s a club card, nectar card or coffee card, businesses use loyalty schemes simply because they work. Not only do they encourage customers to spend more to earn more, but it also enables retailers to make high margin or clearance items more attractive by offering additional loyalty points to customers purchasing these items.
Therefore, by operating a successful loyalty scheme, businesses can move away from simply competing on price alone and instead use promotional methods to generate business and create an experience that keeps customers returning.
So, in conclusion, with the hot weather encouraging consumers to return to the high street and spend again, businesses need to ensure that their strategies for the new financial year aim to make the most of this added sales potential both online and in their stores. By harnessing cutting-edge sales tools and implementing proven methods for generating extra revenue, businesses can move ahead of competitors by promoting a better, more personal customer experience.
If you would like to know more about how OrderWise can help you grow sales and improve customer service, contact us on 01522 704083 today.
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