The retail environment is constantly evolving, with spending habits changing and consumers putting much more thought into purchases.
Advancements in technology, the cost of living and increased concerns around sustainability all add to the many things shoppers consider when browsing or buying.
In order to cope with these ever-changing consumer habits, retailers must be able to adapt if they want to retain their customer base, increase sales and remain profitable.
By tracking customer habits and knowing exactly what they’re doing and wanting, retailers can respond quickly to ensure they’re still building customer loyalty and making a profit in the increasingly difficult sales landscape.
In retail, omnichannel integration is vital to ensure that customers have a seamless, unified and consistent experience across all touch points. This means integrating online and offline channels so that customers know exactly what they’re getting - whether they’re using the website, app, social media or are physically in the store.
This is even more important in today’s online retail landscape, as consumers have started to lack confidence when making purchases and are much less impulsive, so cart abandonments are becoming more of an issue.
Strategies for omnichannel integration include having consistent pricing, product information and promotions appearing across all platforms. Retailers are sure to get disgruntled customers if they’ve seen a discount online that they come into the store to take advantage of, to be told it’s an online-only deal.
Customers will also have a much better shopping experience if they can effortlessly switch between channels and continue their journey without disruption. For example, they should be able to easily make an order online, pick it up in-store and then receive support on how to make a return through a live chat. And even more importantly, staff in physical stores must know how to process a return that was bought online - if basics like this can’t be achieved then retailers are sure to start losing customers.
Although the focus has shifted much more to online shopping in recent years, retailers shouldn’t neglect their in-store shoppers as - although the minority - they still play an important role in retailers’ success.
In today’s environment, consumers in a shop are likely to have already made a decision to buy something and will have come into the store with the purpose of making that transaction. However, just because they’ve come in with that purpose doesn’t mean their mind can’t be changed if they have a negative experience before getting to the tills.
To ensure all in-store customers convert to sales, retailers must ensure they have a positive experience - and ambience plays a big part in this. Things like lighting, music, scent and decor all contribute to a positive shopping environment, encouraging customers to stay longer and ultimately make a purchase.
Another thing that plays a big part in customer experience is how retail staff interact with the customer and the service they provide. Traditionally, retail staff have been encouraged to begin their sales pitch as soon as customers enter the store, but consumer preferences have changed and many shoppers in today’s society prefer to approach staff if they need help, rather than being approached. Saying hello to customers and letting them know help is available if needed makes them feel welcomed and avoids them feeling pressured, which could lead to the loss of a sale.
As consumers have been struggling with the cost of living crisis and looking for cheaper alternatives to their usual purchases, many retailers have been offering discounts and sales as an incentive to keep business steady.
However, retailers need to think about the sustainability of this strategy and ensure they’re still making a profit. Sales should be for certain times of the year - not a constant strategy - so they shouldn’t automatically be reverting to sales prices.
To ensure profitability, customers should be provided with what they want at a price that still gives retailers the return they need - no one wins from a constant sale period and a race to the bottom on margins.
Perhaps one reason for this ‘always-on’ sale strategy is to compete with the likes of Vinted, which has grown massively in popularity in recent years and is a trend that isn’t going to go away. But instead of just slashing their prices to compete, retailers should embrace this trend and find a way to adapt to it. For example, developing a second-hand range and inviting customers to sell their unwanted products back to where they came from. These unwanted products can then be re-sold at a more affordable price than new season offerings, giving customers the choice of whether they’d prefer to purchase new products at a slightly higher price, or purchase pre-loved items at a more affordable price.
Ensuring profitability is a constant challenge in this dynamic industry, but staying ahead of changes and identifying potential opportunities and challenges is the best route to success. Whether done in-house or through the help of a business adviser, strategic planning will help to enhance efficiency, improve financial health and support long-term growth.
To find out more about Duncan & Toplis and how we can help your retail business, get in touch with our expert team today.
