And while the knee-jerk reaction to such trends can be to lower prices or offer bigger deals, these aren’t sustainable. Instead of slashing prices, retailers must provide real value to their customers. This will not only attract and retain the right types of customers but will also differentiate from competitors.
But why would a customer choose to buy an item that they could get for cheaper elsewhere? According to vouchercloud, a service that delivers local deals in Australia, the top five reasons customers pay more are: items are easier to purchase; fast order fulfilment; prestige; low cost of ownership; and exceptional customer service.
Here are some ways you can leverage these factors so you can add value to the shopping experience.
The words “instant gratification” are music to the ears of modern shoppers. Many consumers are pressed for time, and a good chunk of them would choose to shop with retailers who can fulfil their orders quickly, even if it means paying a little more. This is why you should invest in faster order fulfilment. For instance, could you integrate your online and offline stores so customers can shop across multiple channels? This would enable you to provide services such as click-and-collect to save customers’ shipping costs and give them more control.
Speeding up the shopping experience is also about how quickly you can assist customers. The faster you can attend to customers, the more likely it is that they’ll shop with you. Conversely, the longer you keep them waiting, the more time they have to change their minds and take their business elsewhere. If you have a brick-and-mortar store, why not arm your associates with mobile point-of-sale systems this Christmas season so they can get the information they need and ring up sales from anywhere in the store?
Customers want to feel confident about their purchase, so give them a strong guarantee to make them feel safe about what they’re buying. For example, you can offer a refund if they change their mind about an item. Or, extend your deadline for returns, so customers have more time to test a product.
A good example of this is Australian online retailer The Iconic. While some products on their site can be bought at lower prices elsewhere they are still extremely successful because of other factors, like their strong guarantees (free returns for up to 100 days), unbeatable customer service, and brand credibility.
Some retailers think they can stand out simply by adding more products but this can backfire. Shoppers are already overwhelmed with too many choices, so widening your range could end up turning customers away. Myer, our country’s largest department store, has recently done this – announcing it’s cutting the number of fashion labels it holds.
Aim to compete through creative and thoughtful options by stocking up on the right pieces for your target market and displaying them in creative ways.
Implementing a strong loyalty program with great rewards can entice consumers to choose your brand over others. Incentives work even better if they’re exclusive. If you have a loyalty program, find ways to make it more compelling, such as using customer information to create more individual and personalised rewards, or invest in an app that will push offers to customers when they’re near your store. Or perhaps you can sweeten up the perks, or start running special events and initiatives.
‘Smart’ coffee cards are a good example. Imagine you’re the customer and your local coffee shop knows who your favourite barista is or your favourite blend. They can then give you offers based on these exact factors. Or they can provide perks that don’t involve discounts, such as skipping the queue or remote ordering.
Tying in services can make your offerings more unique and compelling. If you’re trying to add value consider offering services that compliment. For example, if you sell apparel, you could start offering personal styling services. Selling furniture? Why not provide home consultations to help shoppers select the right pieces. For example, menswear specialist Henry Bucks also provides style consultations and has a barber in their flagship Melbourne store to provide their customers with a complete lifestyle shopping experience.
Jason Philactides is vice president of APAC sales at Vend.
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
