The retail sales environment in the present-day context is extremely challenging in most perspectives due to the prevailing troubled economic situation in Sri Lanka on one hand and the fierce competition among retailers, large and small on the other.
Adding fuel to the fire, constant price discounters, market penetration of online players, and less disposable income of customers, leads retailers to provide the best possible service to achieve a competitive edge.
The common perception among laypersons is customer experience (CX) and customer service are interchangeable concepts. However, although both concepts are aimed at keeping customers happy and satisfied, there are important differences between the two.
While customer service is the direct interaction with the customer at the retail store for which the floor sales staff is predominantly responsible, customer experience goes far deeper. Customer experience is all the interactions customers have with an organisation at all stages of the customers’ journey, whether it’s a call to customer service, observing an advertisement, or something as simple as paying a bill.
The traditional approach such as wider selections, lower pricing, or lucrative promotions alone are not effective with today’s better-informed brick-and-mortar clientele. Particularly, the largest portion of the clientele, millennials, and Gen Z segment which is changing trends are looking for demanding customer experience rather than the products offered at retail stores. Therefore, providing personalised experience tailored to each segment makes the key differentiation to a retailer.
Personalised experiences, when offered to individual customers, can be unique to visitors to a retail store. Such experiences enable businesses not only to differentiate themselves but also to gain a sustainable competitive advantage. That way, retailers can cultivate deeper relationships with customers.
Lifeblood of retail store
Walk-in customers are the lifeblood of a retail store. Therefore, the staff of a retail shop must treat every single customer who walks through the door like royalty. They have two choices in serving such customers: Either they can simply ring up a purchase or genuinely assist customers to get what they really need to buy.
While the first choice makes the store and the whole business mediocre and unexceptional, the second makes customers feel that they have come to the right place. This feeling not only brings in instant sales, but it invariably can also produce repetition.
This means that personalised in-store experience does not happen overnight or unfold on its own. Retailers must create an unforgettable experience for customers through both the store and the staff. As top priority aspect. from the moment the customer enters through the door until his or her check out, positive customer experience must be made an absolute necessity. Achieving this goal enables the retailer to build loyalty and trust of customers.
In retail selling, connecting with the customers emotionally is crucial. It must not merely be an attempt to persuade the customer to purchase something but genuinely make them feel welcome at the store. Today’s advanced customers detect any fake approach instantly that can backfire dangerously. Therefore, the sales staff must be trained to connect with customers through values and emotions.
Providing a persuasive welcome at the first instance at the retail store can build a strong emotional connection. By demonstrating an appreciation of customers’ preferences and anticipating their needs, the sales staff can evoke emotions of gratefulness and loyalty, strengthening the bond between the customer and the store.
In retail business, customer loyalty plays a pivotal role in attracting foot traffic. Loyal customers not only retain themselves with the store but also, they may tend to spend more. Customer loyalty deprives competitors of their edge effectively. Also, they may become retailers’ unofficial brand ambassadors by spreading good words about the store.
Increasing customer loyalty, therefore, can lead to customer retention, one of the most valuable aspects of retailing. It can also provide higher lifetime value and revenue growth through increased purchasing frequency. More importantly, loyal customers are less likely to switch to competitors offering similar products that can provide an unmatched competitive advantage in the crowded retail market.
Acquisition cost
The impact of personalisation can substantially reduce the expensive customer acquisition cost. It is known that acquiring new customers is a tedious and costly affair for a company. Shaping the strategised customer experience to individual needs and preferences in a retail store can create a substantial impact on existing customers.
Engaging customers by providing pleasantly personalised service in the retail store can make a distinct difference in retaining them rather than going for new ones.
Personalising experience to a visiting buyer also allows a seller to gain a deeper understanding about the general behaviour of customers which can be effectively used in advertising, sales planning, setting up store interiors, and so forth.
It can help build deeper relationships that can be immensely beneficial in repeat selling. Satisfied and loyal customers not only make repeat purchases but also act as brand advocates, referring friends and family, thereby reducing the need for expensive marketing campaigns.
Personalisation of customer experience has shown a distinctive importance in increasing conversion rate. Customers are more likely to avoid competitors in search of products they need if the in-store service provided is enjoyable. They may feel confident that such a service provider could be trusted and there is a substantially good chance of making their buying decisions instantly on that feeling.
Marketing and service teams can effectively use the information and determine what products they bought and what they will purchase next, learn lessons through the sales process and understand why customers reach out to strategise marketing and service plans.
To be successful in the retail business, the seller must be able to make informed and timely decisions. For example, the retailer must make timely and effective decisions on inventory to decide the quantity of each item to be sold and the most effective timelines to reorder to avoid losing a potential sale.
Informed decisions
In this context, personalised customer experience generates valuable data insights regarding customer preferences, behaviour, and trends, empowering retailers to make informed decisions on stocking products on strategised plans.
Organisations are now attempting to go beyond the traditional customer service such as being nice or remembering the names and basic preferences. They now concentrating heavily on providing hyper-personalisation that delves deeper than traditional approach as today’s customers demand instant and comprehensive recognition from the seller before making their buying decisions.
Considering the importance, personalised customer experience has become strategically important and domineering for retail trade. By concentrating on individualised personal interactions more emphatically, retailers can establish deeper connections with customers. Although challenges exist in implementing, the benefits outweigh such confrontations in the long run.
As retail trade continues to evolve with numerous external factors, customer experience will remain an essential key factor that can increase satisfaction, loyalty, trust, and ultimately, business success.
