With economic conditions heightening consumer sensitivity around purchasing decisions, retailers that design differentiated ‘experiences’ around their products and services can drive growth, profitability and lasting consumer loyalty, while also maintaining a price premium over competitors, according to a new report from PwC US, titledExperience Radar 2011: Retail Insights.
The study, based on PwC’s Experience Radar methodology, measures the experiences of more than 6,000 U.S. consumers across 11 industries.
The PwC Retail Insights study finds that consumer loyalty is born from shopping experiences that create strong psychological connections, rather than from points or rewards programs alone.
Looking at five core consumer experience attributes — accessibility, support, quality, presentation and social belonging — the PwC study is aimed at helping retailers identify what’s most important to consumers, and then to develop and deploy an action plan to deliver a great customer experience. This experience-focused approach can help attract new profitable customers, keep existing customers and increase margins.
Identify new ways to set yourself apart
“In today’s economy, retailers must identify new ways to set themselves apart, and that begins with a clear focus on customer experience,” said Susan McPartlin, PwC’s U.S. retail & consumer industry leader.
“A single purchase experience can leave a lasting impact on how the consumer identifies with the retailer, so it’s imperative that retailers enhance how they serve customers to minimize potential hurdles from beginning to end.”
PwC suggests that retailers focus on enhancing service through investing in knowledgeable staff and leveraging front-line employees. According to the study, product knowledge and recommendations accounted for almost one third of good experiences related to support, while only one percent of shoppers cited rewards programs alone as influencing their purchase decisions.
According to PwC, retailers should consider developing an experience action plan built upon their loyalty program’s customer knowledge that strives to achieve five key ‘experience enhancers.’
- Focus first and foremost on shopper experience: Use front-line staff to create experiences that result in psychological connections with consumers. Invest in service by training knowledgeable staff to help affirm consumer purchase decisions and to prevent buyers’ remorse.
- Make customers brand ambassadors: Consumers who experience a positive shopping experience can be the best marketers for retailers, while a single, bad experience can cause widespread damage. Identify, incentivize and promote brand ambassadors.
- Help consumers avoid risk: Attract new customers by helping them overcome psychological hurdles. Overcome shoppers’ worries about losing money on shipping, and press the emotional hot-button of free things. Reduce consumer purchase anxiety with flexible return policies.
- Embrace the anytime, anywhere economy: With consumers shopping both online and offline, understand their shopping preferences before the competition does. Develop a multi-channel strategy that makes it easy for consumers to shop online, offline, at home or in stores.
- When something bad happens, fix it: Provide customers with feedback channels as it may not be obvious that they are unhappy until they leave. Make sure that they are happy with the results — an apology may be enough to create an evangelist
“Customers, like all of us, are social beings, seeking connection and community,” said Lisa Feigen Dugal, PwC’s U.S. retail & consumer practice advisory leader. ”When retailers move beyond solely relying on points and develop experiences based on what’s most important to consumers, you not only drive loyalty, but you create ultimate brand ambassadors who spread the word on their positive experiences.”
- How to close the sale online or in-store with opportunistic shoppers
- Retail shopping is intertwined with social networking for Gen Y
- How can retail stores stay relevant to younger consumers?
- Survey says most Americans prefer in-store shopping
- Consumers more comfortable sharing data with retailers than with social networks
© 2011, TechJournal. All rights reserved.