Customer Loyalty - Brick and Mortar Stores: United States
To maintain customer loyalty and trips to their physical stores, brick-and-mortar specialty or category-focused retailers invest in multichannel marketing to cater to the showrooming and webrooming trend, use in-store user-generated content (UGC) displays, and launch retention programs.
#1: SHOWROOMING AND WEBROOMING
- According to eMarketer, approximately 71% of consumers shop online to find the best price.
- According to various studies, consumers browse products on mobile devices for the best price while in a brick-and-mortar store, which is also known as "showrooming," and even compare products online to find the lowest price, known as "webrooming." This trend has helped online retailers to drive customer loyalty and trips to their physical stores by investing in multichannel strategies.
- According to a Verizon Media study, millennials are the most massive audience for webrooming and showrooming.
- A 2013 Harris poll, showed that 69% of Americans made purchases by webrooming, and in recent years the number has continued to rise as more brick-and-mortar retailers have used multichannel selling by creating an online presence through e-commerce platforms to cater to their online audience.
- A Merchant Warehouse poll revealed that 85% of millennial shoppers reported researching products online before making a purchase.
- Aside from millennials, 89% of the older generation born between 1980 and 2000 also prefer buying items in a store.
- According to Chris Wuhrer, the senior vice president of strategic initiatives and product marketing at Merchant Warehouse, "while about 60% of webroomers have showroomed, nearly 90% of showroomers have webroomed."
- Rent the Runway opened showrooms across major cities in the US offering a personal stylist and the ability to try on and feel the fabric of the clothes. This move, let them use their physical stores as a way to move beyond transactional selling and connect with consumers through experiences.
- Upon entering the store, the customer signs in to their account via a tablet, after which the stylist gains access to their recent purchases and favorite items, making it easy for the stylist to make recommendations and add complementary accessories for the customer. It is also easier for customers as they provide pre-paid, pre-addressed packages to return the products.
- Other specialty or category focused retailers that have used the strategy are Nike and Lululemon, as they have gone so far as to entice customers to their physical stores by offering complimentary athletic classes and workshops at their select locations.
- According to a Marketing Land article, Urban Outfitters added restaurants and coffee shops to several areas so that millennial shoppers could connect with the brand in non-traditional ways and have a reason to enter and remain in stores.
#2: IN-STORE USER-GENERATED CONTENT (UGC)
- In connection with webrooming, many people research products online but buy them offline.
- According to RetailTouchPoints, user-generated content influenced up to 45% of purchases in 2017.
- One way of using this UGC is by displaying them on screens — either a traditional screen or an interactive touch-screen for customers to choose their content.
- Installing walls and screens with UGCs next to specific products has been found to influence customers' purchasing decisions, as customers increasingly use UGC for product research; therefore, retailers match the display to the products in-store.
- UGCs include images and videos of real customers, content from social media campaigns, social influencers' content, offers and discounts, as well as other essential communications like sales, special offers, store-related information, and store guides.
- Applebee's team started a craze using #Fantographer promotion, which encouraged diners to share photos of their meal with the tag #PubDiet for a chance to be featured on Applebee's Instagram feed.
- Within the first three months, Applebee's campaign resulted in a 25% increase in engagement and 27% more followers to the brand's account, which inspires them to return and dine again.
- Shoe retailer, Nine West Store, also used an Instagram photo display screen on its store, which shared other customers' experience of the products on offer.
#3: RETENTION PROGRAMS
- According to Nielsen, 84% of consumers are more likely to shop with retailers that offer a loyalty program. So, online and mobile retention programs are a great way to get customers into physical stores to complete their purchases while establishing a constant line of communication with their customers.
- Using online and mobile retention programs, program members have access to exclusive information that builds trust and loyalty to the brick and mortar brands.
- Fast food retailer, McDonald's, used a digital retention program through its "My McD's" smartphone app in 2017 to bring customers in-store by offering coupons that are only redeemable at the physical restaurant.
- Coffee retailer, Starbucks uses a digital retention program through its successful rewards program, "Starbucks Rewards," offering "star dash" promotions, as well as their newest loyalty perk launched in 2017, Starbucks voice ordering, which brings customers in store by gamifying the purchase process and making buying more convenient through mobile ordering.
- MAC Cosmetics' "MAC Select" digital retention program brings customers in-store by offering member-only events, in-store line cutting, and a recycling program.