In the midst of the Coronavirus pandemic, thousands of stores are closing their doors for good. What was once a vibrant location to go shopping is now nothing but an empty building. It is evident that the concept of retail is changing and many brands are not able to catch up in time. In this article, we will point out the 5 most important things to remember, including the importance of customer engagement through experiences, to help you prepare for the future of retail.
Stores are constantly going online
Over the past two decades, more retail stores have moved their business online, creating hybrid, or even fully online models. There are many benefits associated with this. Most millennials and GenZ’s are buying products through the web and expect to receive promotional material through their email or social media. Due to this, companies are able to save massively, by targeting specific segments of consumers without having to create location-specific campaigns. Ecommerce stores have become the new standard, and with the constantly-decreasing shipping prices, there has never been a better time to turn your store digital.
People are buying from their mobile
The great majority of people are using their mobile devices to browse through and make purchases from their favourite ecommerce stores. Not only are most stores optimized for mobile screens, but they try to make the customer journey as short as a few clicks, to maximize the efficiency of the sales funnel. In the future, we expect this trend to continue and grow further, with customers making most of their buying decisions from the comfort of their smartphones.
Loyalty programs establish authority
Where brands used to focus on attracting new customers, they are now more aimed towards retaining their existing ones. In a fully globalized society with hundreds if not thousands of similar product options, companies differentiate themselves by building a relatable identity. And this is further strengthened by offering rewards to loyal customers. Adding to that, loyalty programs are a great way to turn the purchase journey into a “gamified” experience, which is also a trend for younger consumers.
Customers want personalized experiences
Personalization is not a new trend. It is a global shift in the promotion strategies of most industries, including retail. In short, by personalization, we refer to the targeted offers that are particularly aimed towards a specific audience, increasing the chances of them making a purchase. This can take the form of emails that have a specific tone of voice, promotional material that showcases products that customers are interested in, and the ability to co-create through a common ground of strong values.
Transition to an experience economy
Finally, it is important to give a short introduction to the future of the customer experience. In the past, customers purchased products for their usability and practicality. They would pay high prices for items that they could not find elsewhere, and improve their life accordingly. Nowadays, this is no longer true. Customers today associate a brand with the experiences they provide. This can be an increased sense of status, a better social life, or deeper aspects of their character, like feeling good about themselves. Millions of dollars are spent annually to understand exactly what needs and wishes consumers are looking to fulfil. Equipped with this knowledge, brands can proceed to create experiences that strengthen the bond between the two parties.
You now know how the future of retail looks like and what you can do to prepare accordingly. If any questions remain, make sure to drop a comment in the section below or continue doing research to improve your knowledge.