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Loyalty and the in-store customer experience

Clarus Commerce CEO Tom Caporaso lists out steps retailers can take to eliminate in-store friction and ultimately keep customers coming back.

Photo by istock.com

October 21, 2019

By Tom Caporaso, CEO of Clarus Commerce

Given the emphasis on e-commerce in the retail industry today, it's easy for retailers to overlook the impact of the in-store experience on customer loyalty.

But in-store retail is alive and well — and 71% of consumers say they spend $50 or more every time they shop in a store. Human interaction can significantly impact a customer's emotional connection to a retailer in ways both positive and negative. The in-store experience gives retailers an opportunity to build loyalty moments that create a lasting impact on customers, but 17% of consumers also say they'll walk away from a brand after just one bad experience.

In stores, most shoppers are lost to slow-moving checkouts or muted touchpoints that lack persuasive convenience or competitive offerings. And it's rare for customers to stick around after just one or two poor experiences in stores — 59% will abandon a brand after multiple incidents — thanks to a wealth of options in the retail space.

But don't panic about keeping existing customers in your stores — or attracting new ones. Here's how leading retailers are working to eliminate in-store friction and ultimately keep customers coming back.

●    Adding convenience with technology. Technology can be incorporated in stores to enhance human interaction and create loyalty moments. For example, Home Depot and Walmart offer "click and collect" options, where customers order online and pick up at their nearest location. While in the store, customers still have a chance to interact with human employees to gain a personal touch, but online ordering technology adds an element of convenience that gives the customer another reason to remain loyal.

Whole Foods' integration with Amazon Prime is another great example of online/in-store integration. Whole Foods shoppers can use their mobile app to pay in-store using their Amazon Prime accounts. The payment option adds convenience by allowing customers to quickly pay with their preferred method while also maintaining interaction with cashiers.

●    Speed things up. Disloyalty moments occur when things happen slower than consumers expect. Long lines are one of the primary reasons customers choose to shop online and can deter customers from returning to your store. And while 57% of shoppers say they experience long lines as a pain point, just 35% of brands identify them as a problem. But quick and easy processes can keep customers coming back.

While modern technology, including checkout-less payments, can help speed check-out times, proper sales associate training is an easier and less expensive approach. Staff members should know the ins and outs of your store's processes, including checking someone out or finding a customer the correct size in a piece of clothing. Well-trained sales associates can also help boost loyalty program membership rates, which are often hindered by long signup processes. If employees are properly trained, the loyalty program “sales pitch” can become a quick and easy conversation that results in an enrollment hike.

●    Make it personal. Just because a customer is shopping in your brick-and-mortar store, doesn't mean you're off the hook when it comes to personalization. For example, at Banana Republic, customer information is housed in all in-store so associates can surprise and delight customers at checkout with personalized promotions based on their account history. The ability to look up orders for returned items or to find store credit card information also offers added convenience.

Again, properly trained sales associates can make all the difference here. Sales associates should take time to learn about the customer and make expert recommendations they can't get online. If a customer is interested in jeans, for example, ask about preferences and show her some options based on her needs and wants.

The role of premium loyalty

One of the best ways to cultivate loyalty both on and offline is through a premium loyalty program. These programs charge a fee for customer membership in exchange for exclusive benefits such as free shipping or early access to new products.

Research shows that premium loyalty members tend to purchase and engage with the company more long-term than those who are members of free programs. In fact, 87% of consumers who are satisfied with the benefits offered by a retailer's premium loyalty program will choose that retailer over a competitor that is offering a lower price. Premium programs create a sense of exclusivity not found with free loyalty programs. Additionally, they typically offer perks and benefits from day one, unlike free programs that require customers to make many purchases to accrue points before reaping any reward.

An in-store visit is one of the best times to encourage customers to sign up for a premium program. Sales associates can explain program benefits better than any website, and that initial human interaction can lay the groundwork for a long-term relationship with premium customers.

Don't overlook your stores as a crucial touchpoint in generating long-term customer loyalty. While digital innovation is important, the in-store experience isn't going away anytime soon. Generate loyalty moments by offering quality human interactions that customers simply can't get online.