These cogs in the wheel all have an impact on the customer experience and one wrong foot can stop a loyal customer from purchasing from you again (and we’ve all seen the stats on how much more difficult it is to attract new customers than retain previous ones!). To help inspire you and your current omnichannel strategy, we’ve pulled out the big players who are reaching their consumers across channels in all the right ways.
The first brand to launch a reward card, way back in 1994, Tesco understood the importance of working to retain their current customers. The card offered shoppers points for every pound spent (over £5 at the time of launching), at a time when other supermarkets were focusing on trying to steal customers from their rivals. Incentivising customers, not only via offers, but through their everyday shop quickly developed a sense of brand loyalty and it wasn’t long before businesses across the country were jumping on board to offer a similar rewards system. But, the rewards system wasn’t just beneficial to the consumer. Tesco were able to collect more information about their shoppers including; where they lived, where they shopped and how much they spent. This gave the Tesco team valuable insight into shopper behaviour which benefitted their marketing team, who gained an even deeper understanding of their target markets and how to influence their purchases.
“The reason you were doing this was because you were hoping there was some loyalty effect, but what you wanted to do was open a direct marketing channel to consumers, get more data and run the business better. I don’t think anybody really expected it to go as big as it did… It was like getting Christmas over and over again.” Tim Mason marketing director, Tesco 1995
Tesco were then able to not only create personalised offers and recommendations to their shoppers, but also develop new products and services which would appeal to them. Smart.
Skip to present day and the Clubcard is still going strong with a staggering 19 million users. Gone are the days when you have to carry around the plastic card; you can now easily collect points from the app, which if you have location services turned on will pop up on your phone when you’re near a Tesco store. Now, not only do your points convert into vouchers to spend at Tesco, but also other restaurants and attractions, a valuable addition giving greater flexibility to their audience. To continue this momentum, Tesco recently announced they’ll be offering special Clubcard prices, to further incentivise customers to use their Clubcard whilst driving sales of key products.
The omnichannel experience continues with their Tesco Grocery app which links in seamlessly with the Clubcard and enables you to shop online and have the items either delivered to your home or collect from a pick-up point. They offer a range of monthly delivery packages at different times and prices to suit different needs, from students, to families, to the elderly.
Tesco understand that with the rise of online shopping, consumers want an easy shopping experience when it comes to groceries too. Not only through the ease of collection or delivery but also through the app which remembers your recent and regular purchases so you can easily add items to your shopping cart.
So what can we learn from Tesco? The more you know about your customers, the more personalised your offering can be. Use insights and smart data to understand your customers, what they want and how you can upsell to them in a way that grows loyalty.
Coming to an app near you… The new Tesco Clubcard Plus. Ready those downloads. It’s value you can’t stop talking about. Subscribe online from 8 November. #NewTescoClubcardPlus
T&Cs apply: See https://t.co/TvWITzEbmI for details. pic.twitter.com/U796LB3mrP
— Tesco (@Tesco) November 5, 2019
UGG have really nailed their omnichannel retail offering, thanks to their seamless shopping experience across channels. They’ve covered everything from easily enabling shoppers to buy online, check stock instore and earn points for purchases which can be redeemed instore and online too. Users are able to return products across various channels and prices are consistent online and across their different stores. Whilst that might all seem like simple stuff, UGG have upped their game one step further through ‘Infinite UGG’, a service whereby sales advisers can help customers purchase items not available in that store, as well as through their ‘Magic Carpet’ feature.
The ‘Magic Carpet’ technology invites customers to try on UGG shoes and step onto the ‘Magic Carpet’ which will then produce all the product details on an LED display. Customers can then enter their phone number and will then receive a website link to that product so they can purchase it.
“Before our organizational change, we spoke to the customer by channel, with people, processes and technology aligned relative to that channel. However, there’s no difference between a retail customer and an e-commerce customer. It’s the same customer.” John Kallinich, VP Omnichannel Operations & E-commerce brands.
This appreciation for the online and offline customer being one was especially apparent during the brand’s launch in Hong Kong. They established a strong retail presence in China before opening a store in Hong Kong and launched an e-commerce platform around the same time. Connecting the dots between online and offline purchasing routes is essential to success.
Starbucks loyalty scheme rewards customers every time they make a purchase and those rewards turn into free refills, as well as food and drink items. Rather than paying by card, users are encouraged to top up their Starbucks reward card and use that to pay. The card can be topped up instantly, meaning if a customer is in line and realises they don’t have enough credit, they are able to top-up instantly and that updates across the app and desktop. Not only can you use the rewards on yourself but you also have the ability to send gifts to friends via email, which is a really nice touch – but again the strategy behind this sharing scheme is to get more people instore and signed up. The incentive not only encourages loyalty to Starbucks but no doubt helps reduce queue times too. So how did the coffee giant get people to sign up in the first place? Through a very clever and simple incentive – a free drink!
Through the app, users can locate their nearest shop and even pre-order for collection, which is great for lunchtime or on the school run. They can also view new additions to the menu and even view songs played instore via Starbucks playlists on Spotify. The coffee retailer recently partnered with Microsoft to further advance its in-app offering, using machine learning and AI to allow the app to make personalised recommendations based on local store inventory, popular choices, weather, time of day and previous orders. Collating all of this information, creating predictions and recommendations and then learning from the consumers response on an individual level will allow a type of consumer-understanding never seen before.
To encourage people to visit stores outside of peak hours, they notify users via email of offers that are only available for a limited time, and these offers are usually centred around more profitable items that are at a higher price point.
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Their mission statement is to be the ‘Earth’s most customer-centric company’ and they currently have 50% of all e-commerce trade, so they’re obviously doing something right. Their delivery offering Prime, which has over 95 million subscribers worldwide, has significantly reduced cart abandonment (people are usually put off by shipping fees and times) all whilst creating brand loyalty. Amazon has steadily increased their annual subscription fee year on year, which is justified to the user through the addition of other benefits and discounts, like Prime Video, Prime Music and the lesser-known Prime Wardrobe (which is a similar offering to Klarna, where customers can try on products before paying for them).
ComScore predicted that all Google searches will be spoken rather than typed by 2020, so Amazon ensured they were one step ahead of the game by launching the Echo smart speaker back in 2014, along with the Alexa digital assistant. To further develop that sense of brand loyalty they offered their Prime subscribers the first opportunity to purchase the speaker and then went on to open sales up to the general public in 2015. What’s great about the Echo and Alexa? That it yet again improves the convenience of shopping for users. You can get all the information you need, and most importantly, shop on Amazon, without having to leave the sofa or pick up a device.
Aware that their busy customers are likely to be at work from 9am-5pm when the postman usually delivers, Amazon fulfilled a further customer need with their Amazon Hubs – secure, self-service kiosks as well as attended locations where consumers can pick up their latest orders. With thousands of locations, control of pickup and returns put directly in the consumers hands, Amazon have surely seen a significant drop-off in cart abandonment or delay in ordering.
In spite of their online success and the continued growth of e-commerce, Amazon recognised the importance of seeing products in person and opened pop-up kiosks across the US showcasing various products like the Echo, Kindle and Fire TV. They then launched the Amazon Go store, which caused a media frenzy worldwide with their no queue shopping technology and have since opened bookstores and acquired Wholefoods.
The more options customers have, the more they can tailor the shopping experience to their needs, which in itself can easily improve the customer journey.
With the growth of fast-fashion retailers like ASOS, Missguided and Pretty Little Thing, some retail-based fashion stores have been left in the dust. However, fashion-giant Topshop in the past few years have really drummed up their online approach. They’ve developed their app to provide an easy, fluid shopping experience and blended their instore and online offering.
Through their website or app you can check if a product is available in a store nearby. Instore if you find an item, but they don’t have the stock available in your size, their sales advisors will be able to order it online for you and have it delivered to that store with no delivery fee. Through this, Topshop are able to subvert a negative shopping experience of not getting the product you want and then encourage the customer to come back to the store. By getting customers back instore they will no doubt see other items they are interested in buying. Remember stores are laid out in such a way to encourage impulse purchases. Hot items are placed in the windows or entrances to attract people in, sales are usually placed in a main area to encourage people to browse and smaller items that may be purchased on impulse, or offers, are placed near to the tills to tempt people.
Topshop now also offer a variety of payment and delivery options, which appeal to its younger audience. You can have your order sent next day or standard which takes approximately 3-5 to an address of your choice, to a store to collect or even a Hermes parcel shop, which are mostly newsagents dotted all over for further convenience. Topshop Premier is an annual delivery subscription for £9.95 which offers customers next day delivery at no extra charge for a year. Offering free returns encourages people to shop without feeling committed at the first stage and offering returns instore not only makes the refund timeline quicker for the customer, but again encourages customers to come back instore and hopefully be tempted to purchase something else.
Like most other fashion retailers on the high street Topshop has enabled customers to pay via Klarna. Klarna allows customers to buy items, without initially paying for them – they’ll be required to pay 30 days later. This means if you don’t like the items you can return them without being out of pocket, which has been a game-changer in the industry. This again is thanks to Klarna understanding the needs of the younger generation, who don’t want to waste time trying clothes on instore but also can’t afford to order 3 different outfit options in various sizes. This is no doubt a positive for accounting teams too, decreasing the number of refunds having to be administered so regularly. Klarna has also recently offered customers the opportunity to split their purchase into 3 monthly payments, again helping younger customers manage their finances.
But how does this add to the omnichannel experience? It creates a seamless movement between the physical store and online shopping as well as between the payment and the delivery process. In terms of data capture, using Klarna stops people checking out as a guest and Topshop are now able to collect more data on instore purchases, through offering customers an emailed receipt. Those emailed receipts are a way to link instore purchases to online accounts, but yes it’s handy for the customers too!
So what can brands learn from these super retailers? Your strategy can’t be a carbon copy of another shop, you need to develop your offering based on the needs of your customers.
But how do you understand your customers better? Well, it’s simple, get more information on their shopping habits and interests, whether that’s through an app or loyalty scheme of sorts. Give your customers an incentive and enforce channel adoption, this means more data from the right people. But that shouldn’t be the end of the road in terms of your strategy.
You’ll find as you collect more data your strategy will develop and become more tailored. Providing an omnichannel approach is a journey based on consistently building a better understanding of your audience and continuously developing your various channels to improve their experience.
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