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Revolutionizing retail: How to build brand loyalty

Digital technology can help retailers create the kind of customized and interactive shopping experiences that build brand loyalty online and in-store, but only if they do it right.


Retail

I threw my back out recently and was in desperate need of a massage, but I wasn’t prepared to pretzel myself into the car and drive 15 minutes to see my regular therapist. After a quick online search, I found someone who offered mobile services and arranged an appointment.

When I got ready to pay, the therapist pulled out her smartphone, plugged Square into it and passed it to me. I tapped my debit card, and in less than five seconds, we were done.

It wasn’t rocket science, but I was impressed with the efficiency of the transaction. And I will definitely be a repeat customer because the service was flawless from beginning to end.

That “wow” factor I experienced is gold to anyone in the brand business and exactly the feeling retailers across the country hope to generate in customers as they go about their shopping, in the store and online.

IT pros in the uber-competitive retail sector are under pressure to create an omni-channel nirvana — personalized brand experiences for shoppers that offer the same level of efficiency and convenience whether they happen in-store or online.

Overall, retailers have been slow to execute on digitally driven retailing strategies. Some haven’t been able to pinpoint the right blend of customer engagement strategies and tools, while others are still mulling the high initial investment required.

A recent survey from the Canadian Marketing Association and LoyaltyOne shows that only one-quarter of North American retailers have rolled out near-field communications (NFC), which is a building block to support mobile payment technologies.

As retailers reimagine the storefront, expect to see more of them capitalizing on digital services that empower shoppers, according to industry watcher Joe Holley.

“Retailers will increasingly use technology to engage with consumers for direct analysis of their habits,” wrote Holley in a recent post. “This technology used in data points throughout stores, exemplified through beacon-based messaging, location-based marketing, digital signage recognition and in-store consumer connectivity through retailer Wi-Fi networks, will be used to engage with consumers.”

Hudson’s Bay Company (HBC) rolled out beacons in several department stores across the country a few years back, and confirmed its commitment to digital when it bought luxury brand Saks. In a Marketing magazine article, HBC’s chief executive Richard Baker said the payback on digital investments goes well beyond the online world to a retailer’s brick and mortar operations.

“A customer that shops with us both in-store and online spends three to four times as much as a single-channel shopper and 70 per cent of retail transactions are influenced by the digital experience.”

Before diving in, retail IT pros need to evaluate their business objectives and determine how they can use digital technologies to improve the customer journey and boost the bottom line.

One clothing retailer’s foray into virtual reality offers a cautionary tale to look before you leap. Last year, Tommy Hilfiger announced the launch of virtual reality headsets to enhance the shopping experience in select stores. Within a week, it pulled the headsets because they were having the opposite of the intended effect. Rather than enhancing the shopping experience for consumers and driving sales, the headsets had become a form of entertainment for the shoppers’ children — not the target customer segment.

ATTENTION SHOPPERS:

  • 49 per cent of retailers have rolled out digital signage displays (augmented reality)
    • 29 per cent have rolled out shopper-tracking capabilities via beacons and geo-fencing
    •19 per cent have added location-based marketing and communications
    Source: Canadian Marketing Association

Photo courtesy of Free Digital Photos

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