David Ringer, regional director for the UK and Ireland at tcc global, shares his insight on how to achieve customer loyalty.
Achieving genuine customer loyalty is an aspiration that grips retail chief executives and customer marketing officers the world over. But in an era of unparalleled competition and choice, it’s more challenging than ever before.
It’s vital to understand why customers spend their money with certain retailers, how retailers can deliver value and what they can do to keep shoppers coming back.
What influences shopper behaviour?
At tcc global, we spend a lot of time speaking to consumers to understand their motives.
This year we conducted a comprehensive survey of more than 1,500 shoppers in the UK to find out what really influences their behaviour.
Some of the conversations we had yielded insights many perhaps would think surprising.
Just 34% of Brits list ‘low everyday prices’ as a key factor driving their choice of supermarket, placing it well behind location (48%), range of products and services (40%) and habit and familiarity (39%).
But this makes sense in the context of the enormous choice British shoppers face. A typical individual will have nine retail banners reachable to them, eight of which are easily reachable and four of those are extremely convenient.
Variety of choice has left a void of emotional loyalty, with shoppers feeling no real affinity to their chosen shop.
Our research backs this up. Only a tiny percentage of UK shoppers (3%) are willing to invest extra time to reach a ‘preferred’ store.
Furthermore, ‘I always shop there’ was the primary reason 39% of UK shoppers visit a particular store. And 45% agreed with the statement ‘It would not matter to me if my usual grocery store closed, I would just shop somewhere else’.
“Shoppers want to be rewarded for their loyalty in meaningful ways”
However, we shouldn’t take this as the death knell for customer loyalty. Our study showed that shoppers want to be rewarded for their loyalty in meaningful ways that aren’t limited to points on a plastic card.
Unfortunately, too few retailers are currently doing this.
The differentiators that attract shopper allegiance
Retailers that want to attract their competitors’ customers may have some serious soul-searching to do.
At tcc global, we have witnessed a rising all-encompassing focus on the traditional retail battlegrounds: fast service, value, availability, quality produce.
“Fast service, value, availability, quality produce – paying attention to these factors should really come as standard within every retail strategy”
Paying attention to these factors should really come as standard within every retail strategy, but blinkered retailers are missing out on the differentiators that attract shopper allegiance:
- Proximity to shoppers: shoppers are adamant they could switch retailers if new stores opened close to where they live
- Rewards for shopper loyalty: unrewarded loyalty has left shoppers feeling emotionally disconnected from their main store. Meaningful rewards can restore that bond
- Non-card loyalty campaigns: providing shoppers with personalised ‘thank you’ moments can differentiate in a world of one-size-fits-all points schemes
If strategists adapt to these aspects – while staying solid on the fundamentals – they won’t just keep up with the evolution of loyalty, but be at its forefront.
If this article has captured your imagination, you might be interested in our 2018 Loyalty Reimagined conference. Join us in Barcelona from May 29-31 for masterclasses and speakers exploring the future of retail loyalty innovation. Find out more here.
- David Ringer is regional director for the UK and Ireland at tcc global