It seems like another year when the economic climate and a lack of consumer confidence are the main reasons given by retail chief executives for the recent lacklustre performance in their high street stores.
The fascinating contradiction is that many retail stores are bucking this negative trend, investing and growing. So what sets them apart, and why are so many still struggling?
Standing on the outside looking in is obviously easier, but there seems to be a few lessons to be learnt. It’s now 2011 and those that predicted the death of the shop are admitting that, even though ecommerce is expanding, the shop is here to stay.
It seems fairly obvious that more and more customers are arriving at stores knowing what they want, with information gathered on the internet, but they now expect to be able to shop in a way that suits them. Retailers are slowly waking up to the fact that they are no longer in control of the purchasing process.
Of course, customers get value from a shopping experience in multiple ways, but there is clear evidence that the customer experience is the single most important factor in customer loyalty, so why do so many of our retailers continue to ignore this fact? Obviously convenience, competitive pricing and range are essential, but today they are basic expectations, not a reason to visit. You also have to satisfy customers’ emotional needs.
Having squeezed every penny out of the value chain in today’s tough market, the physical environment is surely one of the best opportunities for retailers to enhance the brand’s relevance and improve the perception of value, rather than discount it. After all, a good in-store experience increases visits and dwell time, and therefore increases sales, profitability and long-term loyalty.
The challenge today is to create real experiences that encourage participation, that are personal to the customer and that are unique to the store - giving people more reasons to visit and engage with your brand, products and services.
Jim Thompson, Managing director, 20.20