Category: Retail

When it comes to the customer experience and the desire of brands to strengthen their ties to consumers, the past year turned all the rules upside down. 

During the pandemic, even the best-prepared companies were caught off-guard in their ability to be agile and responsive. Issues of simple product fulfillment rose to crisis levels as manufacturing stalled and supplies dwindled. Even so, loyalty programs flourished (with one retailer enjoying a 40% lift in cart size among its program members). There also was a renaissance in creativity around brand messaging with the ascent of new digital and social media platforms. 

At the same time, historic social movements dominated the public’s attention and became a fundamental element of how brands speak to and connect with consumers. 

The result: a next-gen customer experience that seamlessly connects the physical and digital worlds across the customer journey. This, in turn, bolsters brands’ ability to maximize revenue while building lifelong relationships with consumers by communicating what they really care about and in a voice that resonates. 

Here are three key takeaways illustrating how brands successfully navigated the singular challenges of the pandemic and how marketers can apply those strategies to future campaigns.

Customer connections transformed. 

The pandemic brought about unprecedented challenges for brands and also ushered in once-in-a-lifetime opportunities to innovate through customer connections. Consider a particular seed manufacturer that had always counted on face-to-face interactions but that, because of COVID-19 restrictions, had no choice but to engage with its customers via digital platforms and vice versa. 

Marketers who for so long have fixated on Gen Z and digital natives found they had to speak to a much broader base of customers who had become, out of necessity, more technologically savvy. Necessity is the mother of invention, and we now have more than a year of this customer-experience laboratory under our belts. 

But the pandemic has not just been a lab. It’s been a wake-up call. 

For example, at the onset of the global health crisis, one large retailer took the position that it would not do commerce via mobile, opting to employ the medium for engagement only. Then the whole world shut down, everybody shifted to digital transactions, and the retailer found itself without a mechanism for carrying through the customer relationship to the point of purchase. Talk about a missed opportunity. 

Pre-pandemic, around 30% of people shopped online for groceries (and even at that level, there were cracks starting in the supply chain: grocery stores that failed to track changing customer purchase patterns led to shortages or even mass food spoilage). During the pandemic, 80% shopped online. As the pandemic subsides, we anticipate the numbers will settle out a “new normal” above what we saw pre-pandemic. 

What was a temporary stress on the customer experience is now truly the new normal. This 50/50 split also highlights the need for companies to be more diligently focused on the intersection between “offline/in-store” experiences and digital ones. 

Test-then test some more. 

One advantage of the shifting rules of commerce has been that brands can be freer about experimentation, considering many possible customer experiences and then using data and analytics to inform their decisions. Testing approaches and using data science to help ensure a clear understanding of customers and what they truly care about is the very foundation of innovation and authentic customer experiences. 

The importance of testing cannot be overemphasized. Yes, innovation is about being bold and taking risks, but it’s also about being accountable and measurable. Testing and measurement offer a framework for what success looks like and, as such, are critical components, whether in developing products and services, designing a marketing strategy or perfecting the customer experience. 

The truth is, some brands throw millions of dollars at this thing called “innovation” but have no real measurement strategy for understanding the overall efficacy of their ideas. Leading companies often tackle this challenge by measuring or implementing NPI, a new product introduction. 

Having a solid measurement framework and not being afraid to experiment constantly with innovations are essential elements of success as we emerge from the pandemic and reimagine the everyday way of doing business. 

Chatter is not noise. It’s your road map. 

Another key tool is social listening before, during and after a campaign. This has become an indispensable tool to inform everything from overall brand strategy to the social movements that resonate with customers. 

Take the social issues that have come to define our times. They are at the forefront of everything, whether in the nuclear household or a multinational corporation. Our research has found that consumers will spend more money with a brand that has social good as part of its charter than they will with brands that stay on the social sidelines. 

Being socially conscious is not just altruistic for brands today; it is key to business success, with many of today’s leading marketers having entire departments focused on brand purpose. 

There are those brands that may think aligning with cultural movements is risky. As the data bears out, however, the reality is that it’s a cornerstone of building consumer affinity and enhancing the customer experience. 

Social listening enables marketers to get down to the granular level of what customers care about, leverage innovations and take brands where they need to go. That’s true whether in creating a singular marketing campaign, redesigning the in-store shopping experience or building partnerships with other companies that have a stake in the customer relationship. 

On that point, there is another enormous opportunity to maximize the customer experience by thinking beyond just your own brand. Every company must ask itself how to build relationships with complementary partners—and sharing valuable customer data among those players—can enhance its consumer relationships. 

For example, if you’re a retailer, you may want to take a sharper look at your relationships with wholesalers—which are equally as responsible for the customer experience, after all—to help ensure they are providing as high a level of customer value as you are. 

During the transition, there’s been a change in focus from the front office to the back office. The companies that performed best are the ones that understood that shift. Brands have had to get smarter about areas like data and analytics that traditionally fell to agency partners and choose the right partners with the experience and expertise to bridge your business’ front- and back-office functions. 

From taking a stand on social movements to developing the products and services consumers desire and delivering the highest-quality customer experiences, brand marketers must work continuously to understand their customers and what they are demanding after a very trying year. Considering the velocity with which technology, brand-consumer interactions and social changes are happening, they surely cannot afford to rest. 

Views expressed in this presentation are those of the author and do not necessarily represent the views of Ernst & Young LLP or other members of the global EY organization.

This article was written by Josiah Johnson from Ad Age and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to legal@industrydive.com.

Shopkick is an omnichannel solution that allows brands and retailers to engage and influence shoppers throughout the entire path to purchase, in-store and online. We share key intel on ever-changing consumer shopping behaviors and trends, and provide our partners with real-time shopping data, helping them fill gaps in the customer shopping journey. To learn more about how Shopkick can help you drive awareness, incremental sales, and customer loyalty throughout the full-funnel shopping journey, contact our team. 

Dive Brief:

•  While the pandemic is widely seen as boosting e-commerce sales, it may be more accurate to say that consumers have become more “digitally savvy,” according to a new report from Forrester.  
•  Forrester found that more than half of U.S. e-commerce shoppers “enjoy trying new brands,” for example. And 63% say they spend time comparing products before they buy.   
•  Still, stores remain the biggest pull for shoppers, and Forrester estimates that 72% of retail sales in the U.S. will take place there into 2024. The top reasons for shopping in store, Forrester found, are to test products (47%) and being able to walk away with an item after purchasing (38%).  

Dive Insights:

Free and available vaccines in the U.S. have tamped down the worst consequences of the pandemic in many areas, but there remains an asterisk next to these improvements, as variants of the virus, including the delta strain, have introduced new levels of uncertainty. 

That includes retail and traffic to stores and malls. Still, these days more stores are opening than closing, and the pace of footfall is up. In July, shopping mall traffic exceeded pre-pandemic levels (up 1% compared to July 2019 at indoor malls and up 1.8% at outdoor malls), according to a recent report from Placer.ai. 

Those visits have fallen again since then. In August traffic compared to two years ago fell 2.5% at indoor malls and 4.7% at outdoor malls, which Placer attributed to rising COVID cases, the timing of Labor Day and the return to school. The firm blamed the pandemic’s surges for further declines in September — 6.5% at indoor malls and 5.2% at outdoor malls — compared to 2019. 

While October isn’t looking much better, the approaching holidays could send more people back to physical locations, however, especially if COVID cases once again begin to slide, the firm said. 

Stores have turned out to be an important source for marketing and customer acquisition, as many pure-play e-commerce companies have found. But according to Forrester, retailers also must ensure that their stores are worth the effort. 

“The goal of these stores should be to deliver experiences and support operations that remove customer pains that impact behavior and provide diverse capabilities for catering to different consumer preferences,” Forrester said by email.  

Consumers have come to expect more fulfillment options when shopping online, with 45% of Forrester’s respondents saying they prefer many options. Thirty-eight percent of consumers said they’re using BOPIS services more than they used to, while 32% of respondents said they plan to continue using curbside pickup after the pandemic is over, the report found. Nearly a third of consumers who used curbside pickup services did so to save time finding the products in store on their own. 

And when it comes to returns, a physical presence may be an asset to retailers, the report found. Forty-one percent of consumers said online returns are difficult and over a third of consumers said this has discouraged them from purchasing online in the first place. Over half of respondents said they prefer in-store returns.

This article was written by Caroline Jansen and Daphne Howland from Retail Dive and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to legal@industrydive.com. 

Shopkick is an omnichannel marketing solution that can help you seamlessly bridge the gap between digital and physical shopping channels. Read more success stories and contact Shopkick to learn how to become one of our partners.

Driving incremental sales is a crucial goal for modern businesses. For brands and retailers, a major indicator of success can be found in an increased number of leads, customers, or sales, that wouldn’t have occurred without a specific marketing campaign. In this post, we’ll discuss what it means to drive incremental sales and which strategies you can implement to get started.

What are Incremental Sales and Where Do You Start?

Simply put, incremental sales are a way to gauge the success of a marketing campaign. Specifically, the concept refers to measurable results — the increase in the number of units sold — of a marketing activity or promotion. In order to measure the incrementality of a marketing campaign, you’ll first need to identify baseline sales figures and establish key performance indicators (KPIs). 

Baseline sales figures are foundational. In order to know exactly how well your marketing campaign performs, you’ll need to know how your business performs without it. This requires research into historical sales data to find a rare period that was not supported by a marketing promotion. Once your campaign has completed, and you have both baseline sales and total sales, you can determine incrementality by calculating the difference between the two.

Although the difference between new and baseline sales is the key incremental sales KPI, there are other related KPIs you may want to track as well. For instance, you may want to know your new customer percentage to determine how much value to place in a specific strategy or partner. Perhaps it would be helpful to calculate participated revenue, the amount of revenue generated by an affiliate partner who came into contact with the customer at some point during the sales process. Or, you can track sales completed in less than five minutes with the quick conversion rate formula.

Once you’ve calculated baseline sales and determined your KPIs, you can now explore different strategies and tactics to actually drive incremental revenue including:

• Utilizing contextually relevant offers and incentives 
• Building trust and brand affinity to influence more frequent purchasing 
• Expanding your target audience to reach new customers

Strategies to Drive Incremental Sales

Utilizing contextually relevant offers and incentives

Contextually relevant point-of-purchase offers can drive unplanned impulse buys by influencing consumer behavior in the crucial moment of purchase decision. For example, a personal care brand is looking to drive incremental sales across its full product portfolio. When a shopper makes their way to the shaving aisle with the intention to buy a pack of razors, a contextually relevant promotional offer at the point of sale may incentivize the shopper to not only purchase razors, but also shaving cream and aftershave lotion, resulting in a larger basket size and an unplanned, incremental sale. Aside from product bundling, consider the use of rewards at the point of purchase to avoid the use of margin-diluting coupons, discounts, or cash-back incentives.

Build trust, affinity, and loyalty

Building trust and brand affinity can drive incremental sales by influencing consumers to purchase your brand more frequently, and over competitors. One study found that 81% of customers feel the need to trust a brand before making a purchase, and while a good reputation may get consumers to try a product, 87% said they’ll soon stop buying it unless they come to trust the company behind the product. 

So, how do you generate trust? There are several avenues to consider. Today’s consumers want to support brands that align with their values, and that are authentic. Finding a way to tell your brand story and connect with consumers in a meaningful way is a key to building trust. Consumers also value consistency and respond well to seamless messaging and experiences across all channels. 

While driving incremental sales is the end goal, brands can’t lose sight of what’s important —  the customer. When today’s consumers have a negative experience, it’s crucial that brands not only listen but act on their feedback. Building this genuine level of trust and affinity will in turn lead to more frequent purchasing, increased basket size, and incremental sales.

Expanding your target audience

Another way to drive incremental sales is simply by expanding your target audience to reach a larger customer base. A third-party rewards app with a large existing user base is a great way to reach new customers. Apps like Shopkick not only help brands and retailers tap into a unique audience, but can also help them increase loyalty and incremental sales amongst existing customers. In fact, 50% of all spend driven by Shopkick is incremental, with 63% coming from new customers and 37% coming from increased loyalty of existing customers by influencing them to spend more or purchase more often.

Measure, Test, and Tweak

Once you’ve planned and executed your incremental sales campaign, you’ll need to measure and analyze the results in order to determine its effectiveness. Whether your campaign was a success or didn’t perform as you’d hoped, experiment with different variations of your campaign, and optimize your strategy based on learnings from historical successes or failures. You may decide to increase or decrease your pricing structure, test out different advertising channels or platforms, or make changes to your messaging. 

Drive Incremental Sales with Shopkick

Understanding how to drive incremental sales is fundamental for marketers, as an increase in sales represents true success in marketing efforts. By leveraging contextually relevant offers, building trust and affinity, and expanding your target audience with a third-party app like Shopkick, you can boost incremental sales while also keeping customers engaged, earning their trust, and rewarding them for their loyalty. When Kraft partnered with Shopkick to drive sales across multiple brands in the holiday season, Shopkick’s unique rewards model drove an impressive 7.6:1 ROI, and 55% of purchases were incremental.

Shopkick is an established mobile rewards shopping app that helps brands and retailers keep their stores, brands, and products top of mind throughout the entire shopper journey, driving incremental engagement and sales. We have a proven track record of helping mobile marketing spend go further by collecting real-time actionable first-party data for our partners. To learn more about how Shopkick can help your marketing strategy and build brand affinity, contact our team.

Brands and retailers have consistently relied upon loyalty rewards programs to offer consumers incentives in exchange for repeat business.  Continue reading “Loyalty fatigue: How brands and retailers can combat it”