By Mark Croxton, VP Customer Support at Symphony RetailAI.
Consumers are in a stronger position than ever in their relationships with brands and retailers, and their satisfaction and loyalty come with a high price tag. To meet their expectations, retailers need to provide personalised and memorable shopping experiences. Promotions have a key role to play in this.
Shopping: it’s about personal experience
When, how and why does a customer decide to buy? There are many answers to these questions – price, availability, ease of purchase, etc – but it’s worth taking a look at the hierarchy of factors that influence purchasing decisions.
In today’s connected world, there are countless sources of information and consumers are influenced from all sides: by friends, word of mouth, social networks, media, thought leaders, or advertisements. But, as a study by Ipsos shows, consumers trust their own experience above all (66%), far ahead of friends and family (35%) or social networks (16%).
Personal experience needs to become a central element of a retailer’s strategy. Other points of contact and sources of information obviously play important roles, but the experience that the customer is left with is what really makes the difference.
Emotion creates the most memorable experiences
More than the product itself, the quality of brand interactions is the greatest influence on customer satisfaction and loyalty today.
Offering the right product at the right time, providing a smooth shopping experience, being responsive… all of these have become minimum requirements. They are no longer key differentiating factors that they were a few years ago. Today, retailers must be proactive and value the customer’s individuality. It’s emotional engagement that really makes the difference.
Promotions can be a great way to create and reinforce that emotional engagement – providing they are personalised and intelligently targeted.
How to create an intelligent promotion
Of course, price remains one of the decisive factors in triggering purchasing decisions and is the main feature of a promotion. But simply reducing the price is no longer good enough.
The important thing is not to be constantly running lots of promotions, but the right promotion for the right consumer. An offer needs to be handled intelligently, following one guiding principle: it must give the customer a feeling of privilege and the impression that they are being rewarded for their loyalty. Personalisation is absolutely essential.
This personalisation can take many forms. For example, when promotional catalogues are sent out, a few products can be highlighted that have been specifically chosen for each customer, based on their preferences and purchasing habits. By using digital tools to personalise these offers, a stronger emotional bond can be forged with each customer and the effectiveness of the promotion will be improved.
Surprise and the unexpected can also be effective tools to play on the emotions. For example, a customer might be offered a birthday gift which they can pick up in store. Each gift can be personalised according to the customer’s tastes (e.g. a bottle of wine or a cake). By playing on the element of surprise, the brand is creating a strong and lasting emotional bond with the customer.
An intelligent offer is first and foremost an offer that creates emotion. HBR research shows that customers who are emotionally connected to a brand are 52% satisfied, as this connection increases spending and profitability. And this emotional commitment is all the more important, if not essential, for the younger generation.
One of the main challenges in implementing intelligent offers is to go beyond transactional data (the historical data that makes it possible to understand what customers are buying) and instead to look at the data of 'emotional experience' (the data that makes it possible to understand passions and motivations.) Today’s brands have the huge advantage of access to an unprecedented level of knowledge about customers and technologies that are sophisticated enough to put all of this information to good use.
Retailers need to look closely at how they can leverage these elements to create intelligent promotions which delight customers and keep them coming back for more.