Filter by/
Region/  All
Type/  All
Sorted By/  Most Recent

Five ways to improve customer retention

By / / In /

Tim Koshinsky VP Solutions OLR RetailThe battle for market share in retail is not necessarily a numbers game anymore, it’s a value strategy. Retailers performing best in their sector today have one thing in common: they know how to nurture long-term customer relationships, as Tim Koshinsky (pictured) explains.

 

Fostering consumer loyalty can be a tricky art to get right, as there are a huge number of factors and touch points that can influence sentiment towards a brand. And in the current, competitive retail environment, making one wrong move can result in a customer defecting to a competitor.

Creating an effective loyalty solution is a unique process to each business, but there are a number of fundamental elements that lie at the heart of all successful strategies. For retailers struggling to increase their customer retention rates, here are a few key areas to focus on as a starting point:

Get the basics right – in all channels

‘Trust is built with consistency’ said the Governor of Rhode Island, Lincoln Chafee. The context for this quote might be politics but it certainly rings true within retail, especially when it comes to brand perception.

Analyst McKinsey and Company hit the nail on the head in a recent report, in which they said “it may not seem sexy, but consistency is the secret ingredient to making customers happy”. And while most retailers have achieved this in their brand appearance, the same level of accomplishment does not always exist in their product availability and fulfilment capabilities.

In the omnichannel era, customers expect convenient service however they choose to shop. This means delivering what they want, when they want it and however they want it delivered. In order to achieve this, retailers must ensure their operational systems are fully integrated and offer complete data visibility. Outstanding customer experiences stem from seamless back-end user experiences.

Create a trusting relationship

Most companies can deliver once, but how many can keep coming up with the goods time and time again? Once the basic offering is nailed, retailers should focus on refining that service to create great interactions during every consumer encounter. Customer service is incredibly undervalued by many retailers and therefore presents a real opportunity to edge ahead of the competition.

Exceed their expectations (consistently)

Some retailers make the mistake of chasing new business, meanwhile leaving existing customers – their biggest brand advocates – at the bottom of the pile. Turn that perception on its head and work hard to exceed the high standards that loyal customers have come to expect. This could mean creating a marketing campaign to reward repeat purchases. Alternatively, it could involve using data from integrated operational systems to see where even quicker more streamlined service can be delivered.

Integrated operations, inventory visibility throughout the enterprise, demand forecasting and replenishment planning are the raw ingredients in building this effective loyalty strategy. They are the tools which ensure, when the moment arrives, that consumers are able to buy the goods they want in a convenient manner – time and time again.

Promote your expertise

The retailers that stand out from the crowd are the ones who are passionate and knowledgeable about what they do. Customers want to know they’re buying from the best, so use all the tools available to create content which proves this. A well-written website, strategic social media output and strong marketing content is essential armour to ward off rivals. And don’t forget to address long-term customers with your messaging, as well as newer ones.

Listen to feedback

The art of listening is undervalued among many retail organisations. While it is important to think creatively and innovate, using genuine feedback is an important way of improving day-to-day customer experiences. In addition to surveying shoppers, it is also useful to carry out internal audits; this may unveil operational problems that are negatively impacting service capabilities.

Retailers who don’t listen to feedback may find themselves unable to deliver on customer expectations consistently, which makes it difficult to build trusting relationships. And in today’s fiercely competitive retail environment, consumers are likely to look elsewhere for an alternative retailer they can trust to deliver at every touch point.

Tim Koshinsky is VP Solutions at OLR Retail.

 

 

Sally Hooton
Author: Sally Hooton
Editor at The GMA | www.the-gma.com

Trained as a journalist from the age of 18 and enjoying a long career in regional newspaper reporting and editing, Sally Hooton joined DMI (Direct Marketing International) magazine as editor in 2001. DMI then morphed into The GMA, taking her with it!

Leave your thoughts

Related reading

  • Keep up to date with global best practice in data driven marketing

  • This field is for validation purposes and should be left unchanged.