Category: b2b

A closer look: What do consumers want from brands?

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A closer look: What do consumers want from brands?

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Knowing what consumers want is the difference between being effective and invasive. The brands that are most attuned to their shoppers are better able to allocate their resources, conserve customer acquisition cost, and churn greater year-over-year revenue. Understanding the desires of consumers has worked for companies like Starbucks, Apple, and Amazon that have sustained loyalty over the years. 

Gleaning insight into the modern consumer’s mind is beneficial in dictating your strategy. It can be easier said than done, which is why so many brands are miles behind where they’d like to be. However, if you’re committed to understanding, investing, and adapting as you go, your brand will begin to stand out as a pioneer and an innovator. 

What Do Consumers Want From Brands?

An Omnichannel Shopping Experience

Very few shoppers are solely “online” or “offline” consumers. The vast majority of consumers shop back and forth between websites, social media, mobile apps, and physical stores. These omnichannel shoppers spend an average of four percent more every shopping trip to a physical store, and 10% more online compared to single-channel shoppers—and, they shop 23% more often. 

Your brand’s customers are looking for seamless consistency in look, feel, and messaging—no matter which channel they choose to interact with your brand. Creating an omnichannel experience fosters a sense of community.

Shoppers want multiple ways to contact brands for customer support, whether it’s through direct message or comment response via social media, IM chat on a website, email, phone, or in-store returns counter. They want rewards programs and special offers to be available on physical cards, mobile apps, and web portal logins—freeing them to shop whichever channel they desire. 

Customers not only expect a frictionless omnichannel focus upfront, but they expect it in your back-end processes, as well. Advances in technology have made it easier for brands and retailers to keep items in stock, fulfill orders efficiently, and checkout orders quickly. Bridging the gap between online and offline channels alleviates bottlenecks that would otherwise jeopardize the overall user experience.

Hyper-Personalization

Hyper-personalization leverages artificial intelligence and real-time data to deliver more relevant content, product, and service information to each customer.  

Taking this extra step in personalization is important, considering 72% of consumers say they will only engage with brands that tailor marketing messages to individual shopper needs and preferences.

Modern shoppers expect exclusive deals on the products they like or would like, quick resolution of issues, timely back-in-stock alerts, personalized recommendations, as well as the ability to find what they need faster and easier. While many of these shoppers are comfortable with sharing data, they also expect full transparency. They want to know what data is being collected about them, how it will be used, and who it will be shared with—as well as a way to opt-out of data tracking. 

Brands can incorporate hyper-personalization into social, mobile, and in-store marketing—which also creates an omnichannel experience—to cater to consumers’ desires. 

Social

Four out of five consumers believe society is more divided than ever—and 78% are looking to leading brands to bridge the divide, using social media as a platform. Brand behaviors that connect with audiences include:

  • liking or responding to a fan
  • showcasing brand personality
  • supporting a cause
  • inviting user-generated content
  • promoting offline events

Consumers want brands to focus on people, not just products. They look to brands to connect disparate groups of people across platforms. Why does social connection matter? Three-quarters of those surveyed said they would buy from a brand they feel connected to over a competitor. When they don’t feel a connection, 70% are less likely to shop there and 61% spend less when they do.

Mobile

Existing mobile architecture makes it easy for brands to connect with busy, on-the-go, smartphone-enabled shoppers. Brands can partner with a third-party mobile shopping rewards app, like Shopkick to reach an already-loyal base of consumers. Shopkick allows consumers to begin their purchase journey by browsing engaging in-app content from several brands and retailers, whether they’re at home or on the go. For partners, this content helps build pre-shop awareness and consideration and puts products at the top of shoppers’ minds. Users can check the Shopkick app to see which brands or retailers offer “kicks,” or rewards points, which incentivize shoppers to visit a store or browse online. Eventually, Shopkick users redeem their kicks for free gift cards, which builds a positive affinity and loyalty for the brands that awarded them. 

In-store

The personalized retail customer experience has overtaken product and price in terms of competitive advantage, with 86% of shoppers willing to pay more for better UX. Brands can leverage Shopkick in-store to offer consumers an engaging and interactive, rewarding experience. In-store, Shopkick utilizes an engaging gamification strategy that drives shoppers to products at-shelf and encourages physical product interaction in exchange for kicks. This allows brands to boost product awareness when it truly matters most—in-aisle, with the product in hand. By offering users an additional kick incentive for making a purchase, Shopkick closes the loop and drives sales. When consumers receive rewards via Shopkick, they attribute them to the partnering brands—also building positive affinity and loyalty.

Value for their Loyalty

Rewarding loyalty may have been a differentiating factor at one time. Now it’s par for the course, with 79% of consumers stating they will only shop with brands who show they care about shopper loyalty.

It’s a common mistake to focus on luring customers through price discounts and special offers—unless you are committed to being known for offering the lowest prices. This angle has worked for brands like Aldi, Dollar General, and Burlington. However, most businesses would rather have greater pricing freedom but still retain their fan base.

Shoppers like to walk away from a transaction feeling like they received a great deal of satisfying value. A loyalty rewards program is a simple, yet effective way to achieve this end goal, without slashing prices. With a loyalty rewards program, customers are motivated to continue shopping to earn rewards points that they can exchange for future rewards or discounts; they continue shopping, brands don’t have to reduce prices. These programs should be transparent and points should be easy to accrue and redeem. 

The best programs also offer flexibility in rewards, so consumers get what they want in exchange for their loyalty. For instance, many programs have different tiers so customers can gain small or big rewards, depending on how much they’re willing to invest. Flexibility will enable customers to stay engaged at every point in the journey. 

Value doesn’t have to be lavish; it can be found in thoughtfulness. A simple gesture like a handwritten note, complimentary sample, birthday bonus offer, or free appreciation gift can go a long way.

Ultimately, consumers want to feel seen, valued, and appreciated. They want to feel an emotional connection with the brands they choose to bestow with their business. After all, it’s a competitive market out there and if you won’t cater to the individual, the consumer knows there are plenty of other brands that will. Tools and technologies make it possible to see each shopper as a unique individual and tailor the experience on a micro level. By taking care to create a personalized, omnichannel, rewards-packed experience, you show consumers you understand what they value and what matters most in their lives.

Shopkick is a popular rewards app that allows brands to connect with consumers through engagement and incentives. Our partners also use Shopkick to drive sales, steal market share, and produce incredible ROI. Contact us to find out how we can help you deliver what consumers want.

American Shopping Behavior Evolving Weekly Amidst COVID-19 Crisis

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Essential items remain out-of-stock on store shelves, consumers tightening belts on nonessential items. 

As COVID-19 continues to impact Americans’ daily lives, new updates and stricter regulations paired with growing concerns about the virus have led to drastic changes in consumer shopping behavior in just a matter of weeks, according to a new Shopkick survey. After comparing the new data with two previous surveys – the first in mid-March, the other in early April – we found key differences in consumer behavior related to in-store shopping, spending on non-essential items, health precautions and more.

In this latest study, we surveyed more than 20,000 consumers across the country between April 16-20, 2020 to gain insights into how consumer behavior has changed as the COVID-19 situation evolves.

Key findings include:

Growing concerns are changing shopping behavior. In the March survey, 76 percent of consumers said concerns about the virus were affecting their shopping habits. Now, with national stay-at-home orders in effect and people having a much clearer understanding of how the virus spreads, that number has jumped to 82 percent, with 45 percent of consumers also saying they were more concerned.

Consumers are frequenting new retailers more often. Consumers remain open to trying new brands and products, with more taking advantage of varied inventory at different types of retailers. The number of consumers visiting a wider range of store types increased in the latest survey, with a higher percentage saying they were shopping in grocery stores (77 percent in April, 72 percent in March), big box retailers (72 percent in April, 69 percent in March), drug stores (45 percent in April, 42 percent in March), dollar stores (35 percent in April, 32 percent in March), club stores (29 percent in April, 27 percent in March) and convenience stores (20 percent in April, 19 percent in March).

Americans are only braving stores once a week. In the March survey, 50 percent of consumers said they averaged one trip to the store per week. Now, with social distancing orders in effect across the country, that number has increased to 60 percent, with a near 10 percent drop in more frequent shopping trips across the board.

Health precautions now include wearing gloves and masks. Ninety-one percent of consumers now take additional health precautions while shopping in-store, compared to 85 percent previously. These precautions include disinfecting hands and shopping carts (89 percent), using debit/credit cards to avoid exchanging cash (68 percent), shopping at less busy times (67 percent) and using self-checkout (53 percent). Due to new government regulations, many shoppers are also wearing protective masks (78 percent) and gloves (42 percent) while in stores.

Younger shoppers are still stocking up. America’s youngest consumers are continuing to fill their shopping carts with essential items. Most Gen Zers (67 percent) and Millennials (58 percent) said they were still stocking up this month, compared to less than half of Gen Xers (49 percent) and Boomers (42 percent).

Consumers are spending less on non-essential purchases. In March, slightly more than half of consumers said they were spending less on non-essential purchases (52 percent). Now, that number has increased to 67 percent.

Toilet paper is still out of stock. Americans are still struggling to find essential items on store shelves, with 64 percent reporting these items as sold out or low-in-stock. Consumers said the most out-of-stock essentials included toilet paper (91 percent), cleaning supplies (81 percent), paper towels (71 percent) and medical items like masks and gloves (59 percent). Meanwhile, other essentials like soups and canned goods (37 percent), baby wipes (35 percent), pasta (33 percent), painkillers and medicine (23 percent) and pet supplies (eight percent) appeared to be making their way back to shelves.

Similar data was uncovered by Trax, the parent company of Shopkick. The leading global provider of computer vision solutions and analytics for retail looked at two weeks of shelf inventory data (March 30 – April 10) from more than 300 stores across a variety of U.S. retailers. Trax processed over 50,000 images of shelves carrying 10 essential product categories to understand the reality of shelf availability in store.

This broad picture of actual product availability depicts similar findings to what consumers reported seeing totally out-of-stock and low-in-stock items included toilet paper (92 percent), cleaning supplies (53 percent) and baby wipes (46 percent). Meanwhile, painkillers, pasta, soups and pet supplies were mostly in-stock.

“As the realities of COVID-19 sink in and we get a better grasp on how to combat the virus, consumers will continue to change their shopping behaviors to match,” said Dave Fisch, general manager of Shopkick. “We have already seen ebbs and flows in actual purchasing behavior as Americans figure out how to navigate the situation for themselves and their families. We hope that by providing the most up-to-date data, we can help paint the full picture of what retailers and consumers are experiencing during these rapidly changing times.”

Get in touch for more information on our continued efforts to help our partners navigate shifting consumer behaviors during these unprecedented times.

 

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80% of consumers still plan to celebrate Mother’s Day

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Although the impact of COVID-19 is being felt across the country, the majority of Americans still plan on celebrating Mom come May 10. The celebration may just look a little different than last year. We surveyed more than 25,000 consumers to gain insights into Mother’s Day plans and preparations during this uncertain time.  Continue reading “80% of consumers still plan to celebrate Mother’s Day”

The most effective customer loyalty programs for retail

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The most effective customer loyalty programs for retail

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Customer loyalty programs for retail are part of everyday life for many consumers as, on average, they belong to over 14 programs. This is a mixed blessing for brands and retailers, however. Competition is fierce for customer loyalty, and it’s not enough to get your customer to sign up for your program—especially since it’s been found that consumers are active in only half of the programs to which they belong. 

Research shows that consumers join loyalty programs predominantly for transactional purposes: 75% mention free products, 71% include discounts, 67% value free samples, and 56% want free services. For brands and retailers, meeting those demands is only the beginning when it comes to keeping customers engaged. Those same consumers also expressed the desire to choose their benefits and rewards (85%) and to experience more personalization (74%). In other words, consumers want rewards that mean something to them. 

Brands and retailers looking to develop effective customer loyalty programs in retail should pay close attention to the following examples. 

4 Examples of Effective Customer Loyalty Programs for Retail 

1. Amazon Prime

Amazon Prime quickly ascended to the loyalty champion’s circle after its creation in 2005, and in the last 15 years, it has amassed more than 156 million members worldwide, including 112 million in the U.S.—that’s 65% of Amazon’s total customers. In the U.S., members pay $119 a year for membership, or $12.95 per month. Since the monthly payment option was added in 2015 to lower the payment barrier, it has steadily gained popularity and is now used by over half of Prime members.

The Amazon Prime program began with the offer of free two-day shipping, but it has expanded to include a wide assortment of other rewards, such as discounts on streaming services and grocery deliveries, Prime Day special offers, and surprise perks. There is also a special version of Amazon Prime tailored to students. Loyalty program members are typical among a retailer’s best customers, but Amazon Prime members distinguish themselves by spending twice as much as other Amazon shoppers. Other retailers are beginning to follow Amazon’s lead. As of 2019, 76% of loyalty programs did not charge a fee, but more than half of the companies surveyed reported that they are considering implementing fee-based, premium loyalty programs. 

Premium loyalty programs encourage spending with attractive offers and the opportunity for customers to recoup their money. This paradigm is similar to the one used by wholesale clubs like Costco, but we often see it in retailers who offer a very specialized product to customers and who already have a high level of loyalty. Gamestop, GNC, and Lululemon are among the retailers with premium loyalty programs because of their niche product offerings. 

2. Nordstrom’s Nordy Club

Nordstrom’s revamped loyalty program, Nordy Club, was unveiled in late 2018 and has approximately 12 million members. The program is free and tiered. Like many loyalty programs, it taps into customers’ aspirations, offering rewards that can be applied to any item. This makes the brand more competitive without lowering the value of big-ticket items. In this respect, it is similar to Sephora’s Beauty Insider program. As with other tiered programs, Nordy Club offers greater rewards for greater spending, both in the form of redeemable points and perks like events and services.

Omnichannel

The Nordstrom loyalty program relaunch modernized it and emphasized omnichannel sales. Social media channels were leveraged to help create a sense of community, similar to in-store events. The retailer also introduced an app for its loyalty program. The Nordy Club also encourages online purchasing and BOPIS, with curbside pickup. In stores, space is set aside for events, a café, and makeover areas.

Multitier

The Nordy Club has four tiers based on annual spending. Benefits at the beginning level include exclusive “First to Shop” launches, basic alterations and workshops, in addition to points for purchases. Points are easier to earn and other benefits improve as the customer rises through the ranks. Benefits include a visit from a home stylist at the highest level.

A Key Part of the Brand

“Our loyalty program is a key part of our brand,” Nordstrom’s co-president and director Erik Nordstrom said, speaking to investors in 2019. “And it’s something that’s been vital to us for quite some time. Five years ago, 35% of our business was done through our loyalty program. It is now at 55% and growing rapidly.”

3. REI Co-op Membership

REI takes community building to a new level with its co-op membership. The company offers a real consumer-owned co-op, and lifetime membership that can be obtained by paying a $20 fee. Members can recoup their membership fee very quickly. REI rewards spending with a 10% rebate on all purchases at the end of the year, referred to as the co-op member’s dividend. (Co-op members also vote for board members.) REI Co-op members get discounts on equipment rentals and used equipment and are invited to special members’ sales events. In addition, they discount their extensive lineup of classes and events.

The REI Co-op membership provides customers rewards for spending and an all-encompassing community experience. In many places, they offer dozens of classes and events to attend at a discount, creating communities of highly focused, like-minded individuals similar to how Nike offers sponsored fitness classes. But that’s not the limit of its community building. REI has a strong stance on environmentalism that it incorporates into its own operations and in the contributions it has made to nonprofit organizations. Identification with these causes leads to strong brand affinity by consumers. This loyalty strategy has been used by other organizations, such as The Body Shop and Target. Does environmentally committed outdoor sportsmen sound like a narrow target audience to you? Definitely not; REI has over 18 million co-op members. 

4. Shopkick

Shopkick is a third-party customer loyalty rewards app that works fundamentally differently from brand- or retail-specific loyalty programs. It is a gamified app that users are motivated to download for the rewards and entertainment that it provides. When a brand or retailer partners with Shopkick, they enjoy the benefits of connecting with already-loyal users, without asking them to join a new program, download a separate app, or pay for anything.

Easy to Use

Users can check the Shopkick app to see which brands or retailers offer “kicks,” or rewards points, which incentivize shoppers to visit a store or browse online. In-store, Shopkick utilizes an engaging gamification strategy that drives shoppers to products at-shelf and encourages physical product interaction in exchange for kicks. This allows brands to boost product awareness when it truly matters most—in aisle, with the product in hand. By offering users an additional kick incentive for making a purchase, Shopkick closes the loop and drives sales. Eventually, Shopkick users redeem their kicks for free gift cards, which builds a positive affinity and loyalty for the brands and retailers that awarded them.

Combats Loyalty Fatigue

Shopkick partners won’t become the forgotten victims of loyalty fatigue because Shopkick is enjoyable and undemanding. Consumers don’t have to download so many different loyalty apps when using Shopkick to earn rewards for shopping with their favorite brands and retailers. Shopkick allows consumers access to earn rewards with multiple brands and retailers, as it doesn’t confine them to one specific loyalty program. In many cases, Shopkick can be used in conjunction with other customer loyalty programs; shoppers can earn kicks with Shopkick and rewards through their favorite brand or retailer’s program.

Advantages for Partners

Shopkick is one of the leading apps of its type. It attracts a broad audience that may be hard to reach otherwise. Like an in-house loyalty program, Shopkick both influences buying behavior and tracks it, providing valuable analytics. Consider how Shopkick helped drive incremental purchases for Georgia-Pacific. When the brand launched its Dixie Ultra Deep Dish Plates, they partnered with Shopkick to build awareness and drive trial and consideration for the new product. The campaign received over 16M impressions and was highly successful in educating consumers before their trip to the store, boasting a 99% branded video completion rate. Nearly 50% of purchasers were not initially planning to buy Dixie products before their visit to the store.

Customers expect loyalty programs to meet their wants and needs. They want their rewards to come fast (45%), easy (34%), and personalized. That’s a tall order in a crowded environment where it’s hard to distinguish oneself. Shopkick provides an opportunity to bring those rewards to consumers in a way that is convenient and beneficial—for brands and retailers, too. 
Shopkick is a rewards app that builds customer loyalty effectively and easily. Our partners use Shopkick to drive sales, steal market share, and produce incredible ROI. Contact Shopkick today join an effective customer loyalty program for retail.