Customer Loyalty is Everything (But Not in the Way You Might Think)
"Quality in a service or product isn't what you put into it," according to the late Peter Drucker, esteemed management consultant and business scholar, "it's what the client or customer gets out of it."
This customer-centric ethos is certainly central to retailer success, particularly for agile web-based companies. As they try to compete with online pure-plays, many traditional retailers view the customer relationship in the same way: meeting the changing needs of the customer is the best way to inspire loyalty. Ever since digital technology revolutionized the shopping experience, retailers have been looking for ways to deliver a more consistent service across all the channels that customers use to reach them — omnichannel strategies for web, mobile and point of sale.
But how far is this innovation aligned with the needs of customers? How successful is it in driving loyalty? Together with Accenture and SAP, hybris commissioned Forrester Consulting to identify how the omnichannel tactics of middle- and large-market retailers are meeting the expectations of their customers. The research — which included in-depth surveys with more than 250 larger U.S. and European retail and manufacturing decision makers, as well as more than 1,500 multichannel shoppers — revealed some interesting conclusions.
Redefining Customer Loyalty
The report showed that customers can be loyal to traditional retailers, even as online pure-plays are redefining the shopping experience, as long as the retailers in question can offer a comparable standard of convenience and even enhance the options available to their customers. Cross-channel fulfilment is central to this. Nearly half of consumers (47 percent) use in-store pickup to avoid online shipping costs, a quarter pick up in-store to avoid the wait, and a further 10 percent simply find in-store pickup more convenient than having items shipped to their home.
Furthermore, 71 percent of customers said that the ability to view in-store inventories online was important or very important; a similar number (73 percent) were likely to visit a store if inventory information was available on the retailer's site. This is a clear differentiator for traditional retailers, yet only a third of those surveyed have operationalized this basic omnichannel principle. Most significantly, only 15 percent of consumers wouldn't feel an obligation to pick up an order they had reserved online — evidence that the widespread fear of layaways is somewhat misplaced.