How Brick-and-Mortar Retailers Can Better Compete With Amazon
It happened again. Just like in recent years past, no company put pressure on its competitors in 2017 quite like Amazon.com. The retail giant accounted for nearly half of last year's online sales, and with movement into spaces like grocery and healthcare, few industries have been spared from Amazon’s strength and ever-evolving business model.
For brick-and-mortar retailers like Toys“R”Us and Macy’s, keeping up with Amazon has meant increased corporate pressure on sales and marketing teams to champion frequent doorbuster deals while still meeting their quotas. This top-down pressure, which is intended to inspire, has actually become a detriment to thriving in the brick-and-mortar setting.
At a time where consumers are looking online for more goods and in greater numbers every week, these aggressive in-store efforts can easily come across as acts of desperation when compared with the frictionless ease of most online shopping experiences.
From Desperation to Inspiration
Whether it’s on a date or in a shop, desperation is a major turnoff for human beings. As retailers attempt to compete with the likes of Amazon, in-your-face promotions and overly aggressive campaigns may actually repel instead of attract.
On top of alienating shoppers who might otherwise be interested in making in-store purchases, operating from a place of desperation promotes a business model that devalues products and the overall shopping experience. The mind-set creates a commerce environment where consumers expect major sales before they’ll visit a store, let alone make a purchase.
Fortunately, brands can reverse these trends and win consumers back with confidence.
Exuding confidence isn’t just about selling products at higher prices than competitors or trying to upsell items. Rather, it’s brands knowing where their strengths lie and what makes them special to customers. Amazon has made price an ineffective battleground for most retailers, but the e-commerce leader cannot control how retailers shape their in-store customer experiences. A major part of this experience is the role of employees.
3 Ways Employees Can Transform the In-Store Experience
A recent report finds that nothing makes or breaks in-store experiences like staff members. A positive experience with staff on average increases a customer’s satisfaction across industries by 33 percent. In the fashion industry, a positive experience with staff can be even more consequential, increasing a customer’s satisfaction by 73 percent.
However, earning these gains isn't as simple as simply having staff on site. Rather, brick-and-mortar retailers must invest in employees that are:
- Knowledgeable: More than half of shoppers (54 percent) value in-store staff who are knowledgeable about products and services — this number rises to 65 percent for millennials. Shoppers also appreciate when employees recognize their past purchasing patterns and needs, and are aware of loyalty membership status.
- Helpful: A third of consumers see value in staff members and/or digital applications that understand their needs. The same number reward staff members who make helpful (upsell) recommendations on new items for purchase — an obvious win-win for both consumers and brands.
- Authentic: Despite a growing interest in personalization and new technologies to execute the strategy, not all shoppers appreciate being sold to. Just 13 percent of shoppers see value in personal marketing messages that include demographic information like name. Again, millennial shoppers have even less tolerance for personalization — only 10 percent see value in this type of personalized advertising. Consumers want authentic, tailored interactions while shopping in-store, where the associate takes time to understand what they really need, and then shapes the experience to those needs.
Investing in employees who exhibit these qualities, and training others on how to be more knowledgeable, helpful and authentic, has real business payoffs. A third of consumers shop in-store because of previously good customer experiences, meaning that every interaction is an opportunity to encourage long-term loyalty and sales.
Amazon will, no doubt, continue to innovate, finding new ways and places to compete. If brick-and-mortar retailers invest in the right people and skills to provide an authentic, differentiated experience that customers truly value, they’ll be successful in carving out a place where they thrive with confidence.
Brennan Wilkie is the senior vice president of customer experience strategy at InMoment, a cloud-based customer experience management platform.
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