transaction

25th September 2017

By Scott Logie, MD, Insight at REaD Group

While online retail services are commonplace and very much taken for granted these days, I remember a time when this was certainly not the case. Christmas 2002 – what feels like a bygone era now – was the first time I used Amazon to buy a few gifts for friends and family. Foremost in my memory being a spectacular Stanley Kubrick DVD box set intended for a friend of mine. Although I ordered in plenty of time, no box set ever materialised and I was obliged to venture out and purchase another to avoid being red-faced on Christmas morn. I duly complained and another set was dispatched without argument. It still has pride of place on my DVD shelf to this day.

I was gobsmacked at the time. No aspersions were cast on my honesty, nor whether the package had actually arrived – no argument at all in fact. Just a replacement product dispatched in a timely fashion. I had to admit that I was more than a little impressed after such a poor first impression. A new standard of customer service had been set in my eyes.

A mere 15 years later and this level of service has become the norm, and most can scarcely remember a time when it wasn’t. It has become clear that this provision of quality service has now become functional and can no longer be thought of as a differentiator. The question of what makes us loyal when it comes to our engagement with brands, spanning a range of sectors, is one without a simple answer.

However, as is indicated in our Retail Trend Report for 2017, one particularly successful method for promoting trust and loyalty appears to be through offering reward schemes and cashback to consumers. There is clear evidence in our research that brands with highly established reward schemes, such as Tesco and Sainsbury’s, have greater customer trust than those with no or only recently introduced reward systems.

Nevertheless, this alone is not enough, brands must strive to be more transparent and be seen to both preach and practice strong values for this loyalty and trust to be truly sustainable.

If we compare our most recent research to our findings from our 2013 Retail Report, we can see that loyalty has undoubtedly increased in those four years. However, while retailers can take encouragement from this there is still plenty of room to improve. Now is certainly not the time to ease up on the pedal. Essentially though, a higher proportion of brands seem to be raising the bar and increasing the pressure for others to follow suit and provide consumers with improved emotional and more rewarding relationships.

One cannot help but be intrigued at how the introduction of new technology may provide brands with a means to enhance their emotional connection with consumers in what is increasingly perceived to be a non-personal world. More advanced technology such as virtual reality seems to be gaining popularity at a steady rate, especially with younger customers. This could certainly present an exciting opportunity for brands to add an unprecedented level of engagement to their customer relationships in the years to come.

Want to know more about how to effectively engage with your customers? Contact us today 

london street

12th April 2016

There isn’t a shopper out there who hasn’t seen the impact of the two great warmongers on our high street: recession and the internet. The empty facings, plethora of charity chops, and low price outlets have led many to believe that the high street isn’t just dying, but is dead, and has no chance of ever being resuscitated.  And yet there are many examples of small towns, town edge malls and inner city developments which are bucking the trend and showing signs of fighting back.

So how do the high street retailers bring back the shoppers, and what does the future hold for the high street?

The economic downfall has limited retail sales and provided a strong rationale for shoppers to use the internet instead! In fact, 83% of consumers claim that they have, or would, shop online due to increased options, discounts and a broader selection of goods. People are more inclined to search diligently for a bargain from the comfort of their own home than brave the damp UK high streets – particularly at busy seasonal times.

The impact of online sales varies by retailer and by sector of course, but the most dramatic shift can be seen in music and film retail, where online retail is relentlessly crushing its high street counterpart. Conversely, sole internet players such as Asos and Amazon, with no bricks and mortar shops, are expected to double their share of the total market.

Electricals stores are also under pressure with just over a quarter of their white and brown goods now sold online. US retailer Best Buy pulled out of the UK last year closing all 11 stores while rival Comet was sold for just £2. Dixons Retail, which owns Currys and PC World, have also seen underlying sales in the UK and Ireland fall by 7%

And yet in fashion, just 9% of sales are online but this is still significant enough for several retailers – including Arcadia Group, which includes Topshop, Dorothy Perkins and BHS – to be looking at store closures. So e-commerce can enhance the high street; retailers just have to get smart. As with most things, innovation is probably the key.  There are no longer any fixed rules when it comes to consumers, or even businesses, buying anything.

So retailers need to be flexible, explore all viable channels and use innovation. In the future, retailers need to employ a series of engaging techniques to persuade its customers that the best deals can be found on the high street.