What Retailers Need This Holiday Season — a Non-Buyer CX Strategy

Holiday sales are expected to grow 4 percent to 6 percent this year. However, inflation continues to be of concern for consumers, with 84 percent of shoppers looking to save money. Recent Sense360 by Medallia research on consumer behavior and spending reveals that shoppers are buying fewer products. However, for those companies that they do shop with, they’re spending more.

While not all retailers may be impacted, the takeaway is clear: Becoming a retailer of choice is more important than ever this holiday season.

How Consumer Shopping Behaviors Are Changing

Price and value are key factors driving consumer purchases due to inflation. Today’s customers are also more willing to experiment and try out private-label store brands to save money. As these and other behaviors evolve, it’s up to retailers to uncover insights about what's changing and keep up faster than the competition.

Adapting a strategy may take time, but what’s most important is pinpointing what’s driving changes and what steps can be taken to drive revenue, with a particular focus on what’s happening with non-buyers — i.e., potential customers who visit a retail store in person or use a retailer’s app or website and leave without completing a transaction.

Why a Non-Buyer CX Strategy is Key

Imagine a typical retail store receives 1,000 visitors a day, of whom, only 50 percent end up buying something. Determining why the other 50 percent are leaving without spending money — and figuring out what to do to change that outcome — presents the potential to increase sales without attracting more visitors. If an average order value is $100, and just 10 percent more of daily shoppers are convinced to become buyers, that could add up to an extra $10,000 in sales per location per day. For retailers with thousands of locations, every point of conversion can add up quickly.

There’s added value in uncovering the reasons behind these non-conversions and not just to recoup potential sales, but also to reduce churn and foster long-term loyalty. When non-buyers turn to the competition to find what they’re looking for, they may end up switching permanently.

How Savvy Retailers Are Using Technology to Understand and Strengthen Their Non-Buyer CX

Getting to the bottom of non-buyer CX issues used to be a huge challenge, but thanks to technology, it’s getting easier for retailers to identify and address points of friction getting in the way of successful conversions. Here are some of the tools savvy retailers are using:

• In-store customer feedback digital survey kiosks: Retailers are gathering simple insights about the customer experience right at their brick-and-mortar locations.
• Mobile consumer panel surveys of consumers who have opted in to sharing their location after they’ve visited a given retail location: Retailers ask shoppers whether they completed a purchase or not and why.
• Digital analytics: These help teams understand the entire digital experience, pinpoint points of friction, and make changes to improve the experience for future customers.
• Always-on feedback surveys on brands’ digital channels: These help retailers understand the root cause of what’s impacting digital conversion rates.
• Social feedback (e.g., brand mentions and social review sites about specific store locations): Brands are using artificial intelligence to analyze this unstructured data and make sense of what’s being said.

Final Thoughts

At a time when retailers are desperate to get rid of backlogged inventory and consumers are being frugal with spending, leading retailers are getting ahead by using technology to understand their customer needs — including those of non-buyers — and leveraging these insights to enhance their employee training, product offerings, operations and more to meet customer expectations and deliver results faster than the competition.

Mike Debnar is principal of retail and digital innovation at Medallia, an experience management software platform.