Retailers Are Experiencing A Shift In Customer Expectations
It's of little surprise that in these challenging times
, consumers have made pricing their top priority in making their buying decisions. Many retailers have in response to this, created the perpetual discount price point. Week after week sales go on until after a couple of years of this strategy, customers have become wary of the perpetual sale in so many stores. They wonder whether they're really getting a bargain after all.A recent survey in Australia revealed that the perpetual sale mode of so many stores in the market have made almost half of the customers cynical about the whole concept. They're so "on sale" conditioned that getting a bargain no longer dazzles or delights them on their own. To them, the so-called "big sale" is just a standard way of doing business. If price remains as the top priority in a consumer buying decision, how does today's retailer reach the customer?
In several earlier articles I predicted that customers will migrate towards a resurrection of a customer service focus. If "great pricing" is now the norm, customers now expect real added value through stellar service and a return to the good old days where store employees spoke with knowledge and authority about the products they sold. Today's great bargains need to be presented by employees who understand customer engagement. The big box self-serve retail model is slowly losing its luster. Successful retailers who aspire to build long term loyalty must train their employees to deliver a highly personalized experience where professional recommendations and product demonstrations give customers to buy from your store in a market where price alone no longer draws the customers.
If great pricing is now the norm and engagement is the key strategy for customer service in this evolving market, what's next? Indeed, big box stores with racks and racks of product in a massive array of choices no longer impress today's consumer. That's because customers have become more frugal and calculated with their hard earned money and look to buy more on a needs-based level than a wants-based one. Massive selection is not going to impress customers when they believe they don't need most of what you offer in your store.
This change in buying mentality indicates an evolution towards customer-centric inventory mixes. Sales will be driven by a customer-pull model as opposed to a retailer's old product push approach. What does this imply in simple terms? Track very carefully what customers buy or ask for and make sure you offer it at great prices. Ensure that your sales team can deliver a stellar buying experience focused on knowledgeable demonstrations and recommendations and an effort to really get to know the customer. Loading up your store with massive levels of merchandise in hopes of "dazzling" your customers will likely fail as they tell you that most of the goods you are trying to push on them, the just don't need and won't buy!
In my next article, I'll portray in detail exactly what customer engagement means and how your employees can rise to the challenge.
Take Action Today:
1) Start detailing what your team believes is an engaging experience for the consumer.
2) Review your retail merchandise mix. What message do you portray to the consumer? Are you a product push or a customer-pull retailer?
3) Consider more scrutiny and selectivity when it comes to sale pricing in your store. If sales become a selective occasion in your store, customers will begin to put some credibility back into discounts and sales again.
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